anyone buying in sydney at the moment?

[alpina]

just wondering if people are taking the cautious approach or still buying at the moment in the sydney market? if you are, are you looking at units or houses?

personally, we are looking at the inner city and eastern suburbs and would be comfortable purchasing in the $400-450k price pt. anyone have a view on this? is there potential on those older syle studio layouts or should we concentrate on 2 bedders?

I know its important to find one with a pt of difference but sadly most the developments in the city all look the same and all share the same advantages.

following a previous thread, i hope im not asking for too much disclosure? :)

boyfriend and i keen to move on to property #2 as our salary situation has improved unexpectedly but want to do it for the right reasons

julie

[Jamie]

Hi alpina,

Have you considered purchasing outside of Sydney?

Remember, there are different property cycles operating in different cities, and the fact (or perception) that one particular market is softening/weakening/(insert appropriate verb here) does not mean that this is the case nationally. Just because you may be reticent to invest in Sydney at the moment doesnt mean this should put you off investing in the near future in general. Some people, including many on the forum, are making great returns in other capital cities and regional centres.

Remember, when most media commentators speak about "the property market", they are essentially referring to "the Sydney property market". There are many other areas to invest your money should you feel uncomfortable with the Sydney market right now.

Best Wishes,

Jamie. :p

[lawsjs]

Conventional wisdom says sell. Probably therefore a very good time to buy. Though potentially even better in a year or so.

[Lotana]

I think most people would feel more comfortable buying their first IP or two in the area they know best.

Investing for growth? Then Sydney market is a buyers market at the moment, good time to buy. Plenty of RE passed in at end-of-year auctions reduced to make really attractive buys.

Units? $500K should buy you a nice new 2 br in city fringe areas. Rental for new units is about 5% at the moment. With a little help from our friends at ATO (depreciation) these units are cashflow-positive after tax with a good prospect of capital growth.

For the same money you can buy a townhouse in Matraville (beach-side suburb to the east of the city) or a terrace in Redfern (city fringe lower socio-economic area). If you are prepared to wait - on my opinion a terrace in Redfern will do the best out of 3 options mentioned above.

Say cheese :p

Lotana

[geoffw]

Alpina,

"Buying in Sydney" is a huge question. That ranges from 1BR units in WoopWoop to mansions in the North Shore.

There are opinions that some classes of property will do well, some will not do very well- no matter what the city.

Michael Yarney (a Melbourne property developer and a contributor to the forum) offers good advice in his newletter. I don't know if past copies are on the web- but you can get a copy of the newsletter by subscribing to pyardney@metropole.com.au

Peter Spann, who gives Wealth seimanrs, gave some opinions in a recent "Property Update" seminar- I've summarised some of that in the thread http://www.somersoft.com/forums/showthread.php?s=&threadid=744

That's just some ideas- I am not a Sydney investor.

[Rolf Latham]

Hiya

Still plenty of my clients buying, BUT a little more fussy than 6 months ago. Many of the near CBD units that were in demand a few months back are less popular.

More and more Im seeing land content deals, townhouses, or small block old established units in beachside or near water suburbs.

I feel the market has become negotiable again.

Ta

Rolf

[alpina]

Lotana,

Interesting you should mention redfern?

what does everyone think of the long term prospects of redfern and newtown?

julie

[Lotana]

Hi Alpina,

I think it is really simple. For those who are prepared to wait inner city "dump" suburbs will bring significant rewards. Location is the king. It is extremely unlikely that the CBD will move away :)Newtown though has already gone through the roof. I buy in Redfern and in Waterloo. These suburbs have height limits for new developments and it is unlikely there will be an oversupply of units in the medium term run. I especially like "discounted" projects in the area - something that is next to a really ugly pub, to high-rise housing commission buildings etc. I think people tend to overestimate negative factors (same phenomenon is well known to share market investors). Can you imagine how much these units will gain when a pub side will be bought by a developer or when the government decides that state housing ghettoes shall be replaced with community housing?

Terraces in these areas are good for redevelopment. Figures at a glance: purchase price $350, construction cost $200, interest $30, sell price $680, profit $100.

Say cheese :p

Lotana

[investor]

Hi alpina

I'm on a similar wavelength with lotana however I consider buying next to commision houses or an ugly pub and waiting for circumstances to change more speculation and gambling rather than investing, sorry lotana.:p

At the moment I would not be considering units in the city at all, maybe in a couple of years but not now. The market is still strong and only just softening a bit. This softening i believe will continue especially in the inner city unit market.

If you were to buy now I would consider a terrace in the following areas :
Newtown
Erskinville
Surry Hills
Darlinhurst
Darlington
Chippendale and maybe just maybe
East Redfern

Again buy with potential to renovate so you can get an immediate cap gain and make sure it has parking or at least potential for offstreet parking that's important.

Regards

PS. I think u are mistaken about new developments in waterloo lotana. Have u checked out the new developments going up in victoria park and also the massive meriton complex in waterloo there are more units going up there than there are people.:rolleyes:

[Lotana]

Hi Investor,

"I'm on a similar wavelength with lotana however I consider buying next to commision houses or an ugly pub and waiting for circumstances to change more speculation and gambling rather than investing, sorry lotana."

I think there is no gamble at all. To me it is clear that with being such close to the CBD and land prices going up, Redfern and Waterloo will undertake a significant change within the next 5-10 years. "The ugly pub" will be sold to a property developer, housing commission towers will be demolished (well give it a bit more than 10 years perhaps). I think I buy on fundamentals (location).

"f you were to buy now I would consider a terrace"

100% on your side. I missed one in Zetland a few months ago.

"PS. I think u are mistaken about new developments in waterloo lotana. Have u checked out the new developments going up in victoria park and also the massive meriton complex in waterloo there are more units going up there than there are people."

There are other developments in Waterloo by less known vendors (Meriton and other large players charge a premium for their brand). As a guide, a 2br 2bath 2 storey unit may cost $540 in Meriton's development, but only $380 in a smaller development (same suburb). Its a HUGE difference!

P.S. Investor, I enjoy reading your posts. Please keep pointing out my mistakes as you see them - we are all learning, and that's the most important outcome.

Say cheese :p

Lotana

[investor]

Hi Lotana

I had a feeling you were going to reply to my post :D :D

I agree with u.

Alexandria is not too bad either :cool:

Regards

[lawsjs]

The rental return is going to awful in redfern in the next couple of years. Moore Park is going to be scary. I just let my $1.05m redfern terrace for 660/week. Not the best return in the world and its only going to get worse!

[summertime]

Hope u havnt got too many of these Jeremy.
Quite a low yield.Are the USA investments(returns) going a long way toward holding these Sydney properties?

Steve

[lawsjs]

No, my US properties are the only things that are keeping my restaurant alive, my aussie properties are all basically neutral.

[Ajax]

Must be a large terrace for $1.05m in Redfern Lawsj. What street is it in?

I bought in East Redfern in 1993 for 155k now worth about 500k. Rental is $350/week (had to reduce this from $400/week about a year ago).

I can't tell you the number of derogatory comments I got when I bought here...ie I don't know any one of our uni friends who would buy here...nice place for an axe murderer to live...great if the aboriginals would move out.

Every time I look (about once every 3 months) the suburb looks better. I have housing commission flats on the next block to my property. That hasn't detracted too much from any capital gains.

There are some very large terraces in George and Pitt Street that I have always liked. Standard 3 storey terraces-drawing room, dining room, fireplaces, ceiling rosettas, unpolished kauri floorboards, wooden staircases with fancy wooden railings, five or six bedrooms. I looked at one in Pitt Street in 1995 (which sold for 309k). Done up would sell for 900k+ now.

I'm anticipating further substantial gains for Redfern because of its proximity to the city and land value. Not sure how all the new apartments will affect prices. I suspect there are two distinct markets (units and houses) and the land value with terrace houses will differentiate them from units.

Ajax

[lawsjs]

Pitt St properties done up (last one anyway) got 1.5, and that was some time ago. Those are MASSIVE. Mine is in Marriott St. Bought it when I was looking for a light shop and got lost!I liked the street!

My terrace was trashed in the hail storm and it took 2 years to reno. Nearly busted me. Still in court with builder over that one. Its now quite nice and was Mcgraths 'property of the month' last month. Chicks dig it anyway:)

Recently bought a warehouse apt in redfern, which I am sort of slowly moving into. I have been told that the TNT towers are going to be units as well. Whole area is going gangbusters as you said. I even like the eveliegh side - where _very_ scary terraces are selling for $500k+

This area (ersko and waterloo also) are my particular favourites in Sydney. Hang in there and we will all be well rewarded.

On an historical level, the area has gone full circle. In the mid 1800's Redfern was THE place for the wealthy merchants to live. The scars in the golf course at Moore Park are there because the 'plain' at redfern was a swamp, and soil was removed to fill in the lake/swamp areas. Hugely expensive earthworks and equally huge properties. For example and to explain Pitt St to people: My mother and I (as is our want) wandered past a property being reno'd in Pitt st and asked to go and have a look. A VERY good exercise - most people are sooo happy to 'show off'. This 5 storey paddo terrace style property had a full size billiard room in the roof, and that was the 'small' room. The 'stables' at the back (fronting George St.) where being converted into 4 (nice) 3br townhouses. Now THAT is a dual occ par excellence! The nice part of that story is that the builders(owners) were what once would have been very 'low' class east european immigrants and they are now very, very wealthy. They were so happy it was amazing!

I have just bought in the 'Watertower' block in Redfern. Its a 160sqm 2br in the original (and apparantly it is quite 'famous') warehouse conversion (1983) in Sydney. It has some drawbacks, but interestingly people in there like it but have had so little CG in the last 5 years in comparison to anywhere else, that they are selling now to get 'some' CG. I bought Marriott St in 97 for 390k (set a record for the street, as it was considered a 'bad' area) and after spending 200k on the reno its worth as I said 1.05m. Good CG there, not the best I've had but I did over capitalise. These units on the other hand - and they are no where near a meriton job, were about 300k in 97. I just paid 480k. Agents (except the guy selling it of course) think I bought in an awful area and that is why the price is so 'bad.'

Now, to ask a rhetorical question, why is it that I think the area is soooo good???? Particularly any bit of it with 'character' I am totally convinced we will take a bit of a hit in the short term because of all these 'spam can' properties. 5 years time though, ours (the 'interesting' ones) will be very highly sort after. MB thinks I am gifted at picking good suburbs, I don't think I am and even if I am I don't think its rocket science after all, but I have yet to be proved wrong.....

It would be a very brave person who would say you are wrong Ajax! And if they do, ask if they have anything in Redfern that they would like to sell to you, just to help them cash in before the market crashes:)

[investor]

Originally posted by Ajax

I can't tell you the number of derogatory comments I got when I bought here...ie I don't know any one of our uni friends who would buy here...nice place for an axe murderer to live...great if the aboriginals would move out.

Every time I look (about once every 3 months) the suburb looks better. I have housing commission flats on the next block to my property. That hasn't detracted too much from any capital gains.



Hi Ajax

You have to ask yourself why such an area has gained so much.

The answer is that woollahra and paddington have gained even more forcing owner occupiers and investors to purchase in the less desirable areas namingly surry hills and even worse redfern.

Redfern had, has and will always have the housing commission stigma there will always be riots in the waterloo redfern area, and you know what riots I am talking about. The agents deceptively have created a new suburb out of nowhere and called it East Redfern to try and say that it is away from those notorious streets however don't be fooled would u like to live in Redfern ?

I for one wouldn't, even taxi drivers don't like driving through that suburb at night and refuse to take fares.

Also don't expect the situation to change, those hundreds and hundreds of housing commission units and houses are not going to go anywhere.

Now I have to admit that Redfern has seen good growth but where is it all going to go once Paddington, Darlinghurst and even Woollahra become more affordable. The first suburb to loose it's lusture if it had any at all will be Redfern.

As an investor u have to still think as an owner occupier. Why should I live in Redfern and not in say Paddington ?
Why should I pay $450 a week rent in redfern when I can get the same terrace for $500 in Paddington, hence the rentals of Redfern decrease and as soon as investors wake up to this so will the prices. It's not like u are getting 10% returns for buying in a less desirable area the returs in Redfern are only 3.5%.

U have to ask yourself this.

Would u pay 600 THOUSAND DOLLARS to buy and LIVE in a TERRACE in REDFERN ?

Would u pay 600 THOUSAND DOLLARS to buy and rent a TERRACE in REDFERN with 3.5% returns when u can get those returns in almost any and more desirable suburb in Sydney ?

If your answer is NO and if u are truthful about it, it should be, then why are u still looking at the area. Wait for the prices to stabilise and even fall. For u to buy in this notorious suburb shouldn't you get at least an 8% return ?

Just something to think about. Just like the dogs in the share market boom were the first to suffer so will those in the property boom and if you have bought too high or overcapitalized in those less desirable suburbs it will be some time before u see your money back. If I was u I would stay away from Redfern for now. Besides there is a bloody good chance that u will get mugged.
:rolleyes:

Regards

[investor]

Originally posted by lawsjs


It would be a very brave person who would say you are wrong Ajax! And if they do, ask if they have anything in Redfern that they would like to sell to you, just to help them cash in before the market crashes:)

Hi lawsjs

It would be a brave person who will buy a 1.05M terrace in Redfern in 2 or 3 years time with only 2.5% net return.

Regards

[Ajax]

Hello Lawsj and Investor,

GIO insurance paid out 18k to me replacing roof and ceilings and reimbursing tenants for rental following that hailstorm.

I have lived in the East Redfern property (on and off) for about 4 years. Never mugged. House never broken into. New car parked in the street never touched. Its a large suburb with many relatively safe areas (probably more chance of breakins in Paddington). Redfern's not just Eveleigh Street (I wouldn't ride a bike down Eveleigh Street atm unless I wanted to end up walking).

There was a house for sale in Eveleigh Street recently for $300k.
Buying that property would be a test of faith.

South Sydney Coucil administrative offfices will be moving into one of the TNT Towers. Their presence so close to "the block" should help to clean this area up. After all no councillor wants his employees mugged whilst walking to work.




Ajax

[alpina]

when i first started this post, i didnt think its was going to be a for and against debate for redfern. not that i mind though, as we have always viewed redfern as a potential hotspot in years to come.

saw a fantastic new 3 level terrace there about 3 months ago (low $500s) - great design but poor location so we ended up giving it a miss

really enjoy threads that talk about specific locations and peoples views of them.

julie

[investor]

Originally posted by alpina

really enjoy threads that talk about specific locations and peoples views of them.

julie

Hi alpina, ajax and lawsjs

Yes I like all of the eastern suburbs personally. I always look for a good buy in anyone of these suburbs. I don't think abit of a debate regarding Redfern is going to hurt or upset anyone. After all if we keep on agreeing with each other for fear that we may upset someone, that will make this forum rather dull.

This is how we learn by reading different views on different subjects, and it's even better when they are concentrated on a specific suburb.

Keep it up, are there any other suburbs in the east you would like to disect ?

:D :D :D

Regards

[alpina]

darlinghurst, elizabeth bay and woolloomooloo spring immedidately to mind :)

julie

[Pele]

Gday

I would like youse to discuss Potts Point, Wollomolloo, Kings Cross, Elizabeth Bay, Rushcutters Bay, Edgecliff and Darling Point.

Pele.

[active74]

as for the crime rate, i would'nt wan't to live in redfern. i installed an alarm for a lady who had her place broken into while she was sleeping,he walked upstairs into her bedroom and stole her laptop, this was only after moving in a couple of weeks prior.

[bbruham]

G'day all,

Some parts of Redfern you wouldn't be seen dead in. But other parts I would kill to own. Such a street is KEPOS STREET.
You only have to drive into this street to love it. I'm saving my pennies to buy one of the cute little terrace properties.

Bruce G.

[lawsjs]

Investor - Considering your nomenclature you are battling badly! Completely missing the point. Redfern has had far better gains than Paddo BTW. Surry Hills has also had substantially poorer growth. 2br terraces are selling for 600k+ so if you want to buy one in redfern that cheap you had better hurry up!

Ajax - You are a genius!
I had also been told the same with TNT towers and council. I believed the units story cos I thought it would make more sense from a developers point of view - Are you certain council is moving there?

[investor]

Originally posted by lawsjs
Investor - Considering your nomenclature you are battling badly! Completely missing the point. Redfern has had far better gains than Paddo BTW. Surry Hills has also had substantially poorer growth. 2br terraces are selling for 600k+ so if you want to buy one in redfern that cheap you had better hurry up!



HAHAHA

Hi Lawsjs

I don't think so. Obviously u haven't been in touch with the market. Here are just some of the terraces in Redfern currently (over the christmas period) FOR SALE at or BELOW 600K
(from 275K to 600K)

http://www.domain.com.au/listing.aspx?mode=BUY&id=2003646332

http://www.domain.com.au/listing.aspx?mode=BUY&id=2003679239

http://www.domain.com.au/listing.aspx?mode=BUY&id=2003733171

http://www.domain.com.au/listing.aspx?mode=BUY&id=2003627504

http://www.domain.com.au/listing.aspx?mode=BUY&id=2003656435

http://www.domain.com.au/listing.aspx?mode=BUY&id=2003736272

http://www.domain.com.au/listing.aspx?mode=BUY&id=2003733404

http://www.domain.com.au/listing.aspx?mode=BUY&id=2003691608

http://www.domain.com.au/listing.aspx?mode=BUY&id=2003660323

http://www.domain.com.au/listing.aspx?mode=BUY&id=2003736661

There you go 2 and 3br terraces starting from 275K(some with parking). You are more than welcome to go and buy them all. You can expect this list to double in Feb as more listings are going to flood the market.

You should thank me for finding u 10 bargains :D

Consider them as 10 Christmas presents
:D :D :D :D

Regards

[alpina]

some real cheapies there

guess hugo street is one of the even shadier streets of redfern?

julie

[investor]

Originally posted by alpina
some real cheapies there

guess hugo street is one of the even shadier streets of redfern?

julie

Yes alpina it is, but none the less it is still Redfern. You see, one or two good streets don't make a suburb. You have to look at the suburb as a whole.

When the median house price of a suburb is 485K and this is taken from here ENTER 2016 FOR THE SUBURB

http://www.homepriceguide.com.au/snapshot/price/index.cfm?action=view&source=apm

then do you consider it smart to purchase at 200K - 300K above the median price of a suburb ?

and if you think the gains are good then check this out
ENTER 2025 FOR THE SUBURB

http://www.homepriceguide.com.au/snapshot/price/index.cfm?action=view&source=apm

which is where I buy houses and terraces.

Regards :D

[Lotana]

Investor,

I think you put too much value in median suburb prices. Most suburbs have areas /streets with more consistent values than the suburb as a whole. There is nothing wrong with buying a $600K house in a suburb with $400 median price, if the price is justified by large than average land area, or by more desirable area within the suburb. Suburbs like Redfern are attractive also for their potential to undergo a complete makeover over time when the socio-economics of its population improve. How far can Woollahra’s socio-economics improve? :)

Say cheese :p

Lotana

P.S. Last night we cooked Fondue (cheese + white wine + spices boiling in a pot on a table and everybody dipping their forks with bred, meat, or vegies). It had an overwhelming success, especially the kiddies liked it. I think it’s a Swiss meal.

[investor]

Originally posted by Lotana
Suburbs like Redfern are attractive also for their potential to undergo a complete makeover over time when the socio-economics of its population improve. How far can Woollahra’s socio-economics improve? :)
Lotana


Hi Lotana

Once again do have any specific information to back your claim that Redfern will undergo a complete makeover and it's socio-economic outlook is going to improve ?

What credible information do you have that the hundreds of commission houses are going to be removed from Redfern even in your lifetime ?

If you do please share that with the forum because I am very interested to find out.

If you don't what are you basing these conclusions on ?

Gut feeling ? Rumours ? Speculation ? Hoping ? Wishing ?

Redfern has always had some streets that are better than others, that's nothing new. For eg Kepos street which was mentioned in one of the posts has always been a better street for tens of years , that is nothing new. Those large, nice terraces were built in the late 1800's and early 1900's.
But the suburb as a whole as you have stated does have a lower socio-economic outlook.

But let's talk about Woollahra now.

For 100 years Woollahra had, has and will continue to have one of the highest if not the highest socio-economic standards in Sydney. There is no need for it to imoprove or change because it's the best of the best.

For 100 years the high growth has been consistent and constant.

No speculation no gut feeling just 120 years of consistant history.

It is and will continue to be the market leader and outperform any other suburb when it comes to terrace houses make no mistake of that.:D

Regards

[Ajax]

Originally posted by lawsjs

I had also been told the same with TNT towers and council. I believed the units story cos I thought it would make more sense from a developers point of view - Are you certain council is moving there? [/B]

Hi Lawsjs,

This is from the South Sydney Council website: -

"Move To TNT
Modified: 12 December 2002

Council recently entered into a lease to take over the eastern TNT towers at Redfern with an option to purchase.

Redfern represents the heart and soul of South Sydney and Council's physical presence will give a huge boost to local business and residents alike.

Council's decision to relocate to Redfern next year is already paying dividends to the South Sydney community. The Sydney Credit Union has indicated in preliminary discussions that they wish to accompany Council in its move.

Other advantages include:

It will stimulate local businesses and provide a boost to resident morale
It is within South Sydney Local Government Area
It is next door to flexible transport
It is a landmark building with landmark signage options
Council has an option to purchase 5000 sqm of floor space"

http://www.sscc.nsw.gov.au/router?model=c&item=2050

Ajax

[Ajax]

and this: -

"We are moving 400 staff into the TNT Tower in mid 2003. This is an important step in leading the way for businesses and the general community to change their perception of Redfern and Waterloo. It is these type of changes that will help to alter peoples perception of how safe our community is."

http://www.sscc.nsw.gov.au/router?model=c&item=2064

[investor]

Hi ajax

Excellent info.

I have also read that they had no choice. They had to move as everything north of Cleveland street will soon be taken over by Sydney City Council.

What are your views on that ?

Regards

[Lotana]

Investor,

"Once again do have any specific information to back your claim that Redfern will undergo a complete makeover and it's socio-economic outlook is going to improve?

What credible information do you have that the hundreds of commission houses are going to be removed from Redfern even in your lifetime ?"

Of course I do not possess any information about Redfern which is not in the public domain. But let's look at what share investors call "fundamentals".

1. Location: you don't want to be closer to the city.
2. Government policy trends: from commission ghettoes to community housing.

Investment in such areas are not for traders, but they steadily perform better than most outer suburbs which combined with above mentioned fundamentals appeal to me as a long-term investor.

Say cheese :p

Lotana

[lawsjs]

Investor,
Battle though you do, they were great properties (douglas st was the only I looked at) but if they were of that caliber then I wish I could buy them all. Your upmarket suburbs will do OK, but if you want real 'investor' cash on cash stuff, the things you mock will walk all over the things you own. You don't seem to have an 'investor' mindset, but you will do OK. You are sort of an 'anti steve mcknight' equal and opposite. I used to argue with him that blue chip property had its place - he argued tooth and nail that cash positive was the ONLY way to go. Now he has softened his stance somewhat and is buying commercial/'better' quality properties. I would be very surprised if you don't change slightly as well. Would a 26k property renting for 260/wk interest you? Before you answer I have to tell you it isn't in Woollahra. Or how about a 56k property I bought last May and just sold for $142k. That wasn't in Paddington either. In the 60's paddington was under threat from the state govt. who were seriously considering bulldozing the whole lot and rebuilding it as it was 'derelict'. I suspect you would not have thought much of your precious suburb then!
I shouldn't argue with you, I have made a lot of money out of people with your mindset, I need you to fund my insatiable appetite for toys!

[investor]

Originally posted by lawsjs
Investor,
Battle though you do, they were great properties (douglas st was the only I looked at) but if they were of that caliber then I wish I could buy them all. Your upmarket suburbs will do OK, but if you want real 'investor' cash on cash stuff, the things you mock will walk all over the things you own. You don't seem to have an 'investor' mindset, but you will do OK. You are sort of an 'anti steve mcknight' equal and opposite. I used to argue with him that blue chip property had its place - he argued tooth and nail that cash positive was the ONLY way to go. Now he has softened his stance somewhat and is buying commercial/'better' quality properties. I would be very surprised if you don't change slightly as well. Would a 26k property renting for 260/wk interest you? Before you answer I have to tell you it isn't in Woollahra. Or how about a 56k property I bought last May and just sold for $142k. That wasn't in Paddington either. In the 60's paddington was under threat from the state govt. who were seriously considering bulldozing the whole lot and rebuilding it as it was 'derelict'. I suspect you would not have thought much of your precious suburb then!
I shouldn't argue with you, I have made a lot of money out of people with your mindset, I need you to fund my insatiable appetite for toys!

Hi Lawsj

Firstly I would like to say Merry Cristmas and a happy new year.

I must admit I am not a great fan of cash flow positive properties unless they are in the areas I like, and that is very hard to do, but not impossible in the suburbs I am fond of. Now before every one starts posting how wrong I am let me say that purchasing cash flow properties in rural areas is great if it is your cup of tea but it's not mine.

I agree with you Lawsjs that in the 60's Paddington was not a good suburb at all, and even today people who used to live there still cannot believe how much this suburb has appreciated. However Paddinton and Redfern are totally different and Woollahra even back then was considered an upper class suburb, you cannot argue with that.

Now since you have pulled two properties out of your impressive aquisitions lets have a look at them. A 26K property returning 52% sounds impressive but it would not interest me. Buying a property for 56K and selling in a year and a half for 142K is once again impressive and I take my hat off to you for that one. Congratulations.

I however will stick with one of the suburbs which are the subject of this thread and that is Woollahra, just to show you and other forumites how easy it is to make money in this suburb. Like I said in a previous thread I don't mind talking about the suburbs I buy properties in.

For you to be in this most impressive forum you are congratulated and I have total respect for your, and any other forumites investing techniques. You all are genious's at what you do and may you continue doing what makes you happy for the rest of your lives.
However to say that someone, especially in THIS forum doesn't " seem to have an investor mindset " is foolish on your part, because no mater how big and smart you think you are ( and I'm sure you are a very smart man) you will always find someone bigger and smarter than you especially in THIS forum.

Regards.

PS. Somehow I doubt you will make any money out of me. I however will be placing a couple of properties for sale soon if you are interested. I wouldn't mind making it in the papers again.

[alpina]

While on the subject of these affordable terraces in redfern, we take it these terraces will be high maintenance from an ip perspective - ie, old and a little run down. We also suspect that the right kind of tenants will be hard to find.

So is it fair to say that people looking at this end of the market are more likely to be people that have a renovate and sell strategy rather than a buy and hold one? And if so, are they also more likely to buy these places a ppor to eliminate the capital gains liability altogether?

What is a typical renovation cost on these types of terraces - 200k?

We have been following the TNT development closely over the last 6 months and am cofident that if the public servants come to work there that the area will start to go through its period of gentrification - a process that happened very quickly in suburbs like Dee Why. We have also heard rumours of the sort of dollars they will be asking for the apartments in the other tower and indications are that the penthouses will be well over $1mill. - sounds like Kings Cross all over again.

Ben & Julie

[bbruham]

G'day Lawsjs & Investor,

This discussion has been the best on the forum for sometime.
Your sword play between each other has been tops.
This is the forum at it's best, suburbs and streets being named,
keeping the to-ing and fro-ings going. With the help of the other partisipants, of course.
If investors haven't learnt anything from reading this post, they'll never learn.
Lawsjs and Investor please keep posting you're livening up the
forum.

Bruce G.

Winners make it happen.
Loses let it happen.

[lawsjs]

Redfern tennants are increasingly film related and have been excellent. 200k for a reno is a rebuild job, but that will get you a 'new' house. Paddington as an area tends to be more affected by damp as it is not as flat. Conversly you often get interesting semi underground rooms.

My play on what Investor does is because of the name. I like playing with people who say 'Only buy X' cos they are wrong and will always eventually realise. Silly billies! 'Local Trader' is probably more appropriate! Even your % return on the $500k property profit I doubt would have been all that huge.

My belief is that investors - true investors - find opportunity anywhere, not just in a 5k radius of their favourite cafe. Whilst the rental I told you about was a country area, the 56-142k property definitely wasn't.

Paddington and Redfern are NOT totally different if you look at things on a different scale. I do make money out of you, principally because you leave simple bread and butter properties for me to have. Sort of investor snobbery. Guy at work has a 10m rental portfolio, consisting of 4 properties. No doubt he wll do well, but his 2.8% rental return doesn't really seem to me that good. He doesn't get my point either! Funny thing is that the pure wrapping people think you are completely loopy and don't get the value at all in prestige property. The key is balance and I do, as a small petty man like to point this out to people. One day I am sure you will buy a property way outback in say Redfern, or maybe even Surry Hills. Take a packed lunch - its a long drive!

It does appear that your investment strategy may be geared towards the media's perception of you and your achievements. It is somewhat ironic that any articles about me (especially recently) have actually been mainly about my _worst_ investment, which incidentally in CG terms has made $800k in just over a year.

Its obvious ou have done some things well, but I do find it annoying when people say there is only one way of doing things. It is very short sighted!

[Ajax]

Investor,

I've been working through your list of Redfern properties.

Like Lawsgs, I quite like the Douglas Street listing. I noticed this listing a few months ago. I believe this has been sold.

http://www.domain.com.au/listing.aspx?mode=BUY&id=2003627504

I know quite a lot about the Walker Street listing (as this house is a few houses down from mine). In my opinion the owner is asking about 75k too much (though the property is in an East Redfern location near Cleveland Street with an easy walk to Central station). The Moorehead Street listing is nearby.

http://www.domain.com.au/listing.aspx?mode=BUY&id=2003660323

http://www.domain.com.au/listing.aspx?mode=BUY&id=2003736272

The Hugo and Eveleigh Street properties are on "the block" bounded by Abercrombie Street, Cleveland Street, Lawson Street west of the railway line. This has always been a problem area for crime. They are cheap for this reason. Interestingly, TNT towers are on Lawson Square which is very close to this area.

http://www.domain.com.au/listing.aspx?mode=BUY&id=2003679239

http://www.domain.com.au/listing.aspx?mode=BUY&id=2003646332

http://www.domain.com.au/listing.aspx?mode=BUY&id=2003733171

The Renwick Street listing is also close to TNT Towers but on the Eastern side of the raliway line (not the Everleigh Street side). This sold for $520,000 on 7 December 2002 ($50,000 below the asking price).

http://www.domain.com.au/listing.aspx?mode=BUY&id=2003691608

Ajax

[lawsjs]

bbruham,
I agree! Its not _quite_ like a good stoush with TW, but most posts are very dull! Bantering with people who know their stuff (Even if they are wrong:)) and are confident about it is always good fun. Nice to know other people enjoy it also!

I will now go and look at Ajax's (the investment guru) listings!!

[investor]

Originally posted by bbruham
G'day Lawsjs & Investor,

This discussion has been the best on the forum for sometime.
Your sword play between each other has been tops.
This is the forum at it's best, suburbs and streets being named,
keeping the to-ing and fro-ings going. With the help of the other partisipants, of course.
If investors haven't learnt anything from reading this post, they'll never learn.
Lawsjs and Investor please keep posting you're livening up the
forum.

Bruce G.

Winners make it happen.
Loses let it happen.

Hi everybody

Yes I too am happy to have found forumites who aren't afraid to express their opinions in such detail (suburbs and street names).

Firstly alpina 200K for a reno on a terrace in Redfern I think is an overkill, and before you say anything Lawsjs I know it happens I just think it's an overkill. I have renovated terraces in Newtown and Erskinville for 35K, they were not totaly dilapitated but initially looked like they needed alot of renovation.

I am not only interested in Woollahra. Currently a suburb which I really like and which I have interests in is Chippendale. In particular the part of Chippendale that is bounded by

Cleveland st (south)
City rd (west)
Abercrombie st (east) and
Braodway (north)

I don't concern myself with the part on the other side of Abercrombie st to Regent st and also I don't particularly like the part south of Cleveland st as it too close to the shady part of Redfern, but I do keep a distant eye on these parts .

I think the above mentioned area is great especially the terraces and warehouses around Peace Park.

So Alpina in conclusion I have to tell you if you have 500K that you must spend now (I have previously advised you to hold for a while) then buy a terrace in this part of Chippendale.

Don't listen to the others cause they have concentrated on Redfern too much I think and are blinded to the fantastic suburbs around it.:D

They have fallen in love with commission houses and seem to enjoy the sound of sirens every night. It must lull them to sleep. Also I can understand the adrenaline rush you must feel when you are about to be carjacked (especially at the crossing in front of Redfern station) it must bring out the James Bond in you. Maybe you should change your nick to 007.

:D :D :D :D

[alpina]

lawsjs,

meant if i someone was to buy one for $400k, would a good renovation add up to another $200k on top?

julie

[lawsjs]

My 200k was spent in 18 months of interest payments, waiting for approval after the hail storm etcetc. The building quote was from memory 120k which blew out 40k.

The only part of my property that was left standing was the front wall. It was demolished from the front room back. It is now a totally 'new' property. All electrics/plumbing/ etc etc.

For safety's sake and to ensure you get what you want, I would _always_ allow room for double what you think. Like an auction where you want a particular property. Make sure you can get it! I would have been smarter getting the insurance payout of 40k (from hail storm) and just doing a surface reno, but I want things done properly, so I now have the second best terrace in Marriott st! The best is just over the road, and was a 500k job to turn a 3 br terrace into a 1br. Stunning!

My old builder said to me with terraces that if the upstairs floor boards need replacing, then allow 100k. It is probably now more like 150k. It is all the nasty stuff that you might find that causes the damage to the bill! Obviously you can do it for less, but I think they are good numbers to use. It is always nice to have had access to $150k and done it for 75! It is _never_ fun to need another 20k at the last minute.

Investor - Chippendale? Do you know where that is??? There are crims in them thar streets!

[Ajax]

Originally posted by investor


Currently a suburb which I really like and which I have interests in is Chippendale. In particular the part of Chippendale that is bounded by

Cleveland st (south)
City rd (west)
Abercrombie st (east) and
Braodway (north)

I don't concern myself with the part on the other side of Abercrombie st to Regent st and also I don't particularly like the part south of Cleveland st as it too close to the shady part of Redfern, but I do keep a distant eye on these parts .

They have fallen in love with commission houses and seem to enjoy the sound of sirens every night. It must lull them to sleep. Also I can understand the adrenaline rush you must feel when you are about to be carjacked (especially at the crossing in front of Redfern station) it must bring out the James Bond in you.

:D :D :D :D

Ha Ha...yeah lawsjs and I have probably fallen in love with housing commission. I did hear a lot of sirens when I lived in Redfern (usually emergency services using Cleveland Street). Not much difference to the car alarms and beeping taxis I now hear at all hours living in a more salubrious part of the Eastern suburbs.

The part of Chippendale you mention is undergoing massive change. Lots of new trendy apartments. A heap of construction going on here.

Ajax

[alpina]

when people refer to the 'block' in redfern, what are they actually referring to?

always see properties for sale in hugo street - how bad is this street? are there any good houses at all in this street or do people simply run a mile when they hear of it? if it really is this bad, i cant imagine getting a good tenant for it and if this is indeed the case, i cant imagine that relying on good capital growth is any more likely to occur

looked at a new development in renwick street not that long ago - great house (new) but location and price (550) scared me away.

might go for a drive through redfern during the week and see how much has changed

julie

[Ajax]

Originally posted by alpina
when people refer to the 'block' in redfern, what are they actually referring to?

always see properties for sale in hugo street - how bad is this street? are there any good houses at all in this street or do people simply run a mile when they hear of it?

julie

Hello Julie,

I was thinking the same thing about Hugo Street. The list of properties posted earlier in the thread contain 2 in this street. One of the listings has a virtual tour. Both properties look quite satisfactory as basic rentals.

There are a lot of uni students who seek rentals in this area (with Sydney Uni and Uni of Technology both close by). I've rented my terrace in Redfern to uni students before-no problems.

I have just considered the area bounded by Abercrombie, Lawson, Cleveland Streets and the railway line as a no go zone. Maybe I'm also prejudging. I'm a little curious about these Hugo Street terraces.

Ajax

[alpina]

enjoyed re-reading this thread so much i thought i bring it back to the top :)

still studying the redfern area and am still intererested in finding out more - looked at a few properties in douglas (requiring work) and young street (nicely renovated but right across the rd from huge housing commission) last weekend

whats the latest with the tnt development? council still moving in and is the 2nd tower still going to be apartments?

thanks,

julie

[Ajax]

Hello Alpina,

an update on an earlier post.

Spoke with South Sydney Council today (currently located at 280 Elizabeth Street Surry Hills). Receptionist said they move to TNT Tower (near Redfern Station) this coming October.

Also latest median price info for Redfern (2016): -

Property Prices* 12 months to 31 March 2003 for postcode 2016
Houses
Average $559,065 Median $550,000
Median change over last 12 months +33%

http://www.homepriceguide.com.au/snapshot/price/index.cfm?action=view&source=apm

Ajax

[investor]

Originally posted by alpina
enjoyed re-reading this thread so much i thought i bring it back to the top :)


Oh no not this thread again :p

Hi alpina, Ajax

Council borders have changed as of the 8th of May. Everything north of Cleveland St is now controlled by Sydney City Council. :)

Regards

Investor :)

[alpina]

got to say - 2480 views from a thread is not bad :)

having been unsuccessful at a redfern action recently, i can honestly say that even redfern is out of my league :)

julie

[hobgoblin]

Alpina,

I haven't read this post in it's entirety, but I thought I'd reply to your original post. I have recently bought in Sydney WHILST being cautious. I have just purchased a small studio unit in Ultimo which is cash-flow positive from day 1, partly due to the high rental return:purchase price and partly due to my, um, 'creative' financing. It has for me a 128% return on investment in the first year. We settle this Friday.

I say I am being cautious by only spending a small amount on the purchase and relying on rental income rather than capital growth.

If the current US economy is anything to go by, I wouldn't being spending up big ANYWHERE right now - Sydney or not, but that's just my humble opinion of course!

Regards,
Hobsie

[hobgoblin]

OK, note to self.
DO NOT use colons on thiss forum when trying to describe ratios.

The inadvertant smiley was supposed to be rental return to purchase price ratio.
Sorry for that folks!

[flyfishinginoz]

Hi Hobise,

After you close on Friday - how about dishing some details on how your deal. :D

I would like to know how you got positive returns in the Sydney market - from a newbie point of view - it doesn't seem possible at this point and time.

Cheers,

Michelle

[Ruby]

Hi Michelle,

You might find some of your answers here!

http://www.somersoft.com/forums/showthread.php?postid=50459#post50459

Ruby :)

[Aceyducey]

Originally posted by flyfishinginoz
I would like to know how you got positive returns in the Sydney market - from a newbie point of view - it doesn't seem possible at this point and time.


Michelle,

I can guarantee you positive returns in the Sydney market.

All you need to do is to put more cash in the deal. At a sufficiently low loan ratio virtually every property (except uninhabitable ones) can be positively geared.

Second option is to change your definition of Sydney - Sydney now extends west to Camden, north to Gosford (edited) & south to Wollongong.....somewhere amongst the millions of properties is a positively geared dwelling - you've just got to find it first.

That involves staying in the market, looking outside the square & being prepared to look at properties that everyone else turns their noses up at.

Cheers,

Aceyducey

[brains]

Acey,
Dont you mean West to Penrith and North to Gosford?

[Aceyducey]

Originally posted by brains
Acey,
Dont you mean West to Penrith and North to Gosford?

Brains, Yes on Gosford - oops always get those too mixed up ;)

But west further than Penrith these days ;)

[brains]

You must mean the lower blue mountains then. I've been snooping around up there of late looking at some properties, its gone mad up there as well in most places.

[ndavy]

I think that the thing investors must take into account when investing in Sydney is that it will always post good returns over the long term as it is truly an international city. Whilst prices in Sydney may seem inflated compared to elsewhere is Aust., in terms of the international market the Sydney market is reasonably priced and therefore still have a lot of growth potential.

[alpina]

any update on the tnt towers? doesn't look like much is happening when i drive past?

julie