Hot spots in Sydney

Recently I read with great interest many threads relateing to hot spots in Melbourne. I thought I start one for Sydney. I am not a season IP investor and nor do I concider myself skilled enough to debate others point of vews.

I live in Sydney and will be looking to invest in an IP here hopefully by end of year. (Only because I know Sydney)

In my opinion the corridor between Parramatta and Blacktown although not considered premium areas is experienceing good population growth and plenty of government/council infrasture spending.

There are plenty of bargins to be had such as this one. Which should provide good yeild and CG.

http://www.domain.com.au/Public/PropertyDetails.aspx?adid=2005754109#

I,d be interested in other more seasoned opions of this area??

The last time I researched it, there're big government developments happening in Parramatta. Westfield is expanding again (as if it's not big enough already).

Personally, I'm thinking buy old houses with lots of land in the Parra - Blacktown corridor and think duplexes in the medium to long term. Cater for families who want new houses.

That particular property will probably rent for around $180 to $200pw? The yield still isn't great. I think the <$300k market has a lot of potential. Seven Hills, Pendle Hill, etc.
Alex

hi Noelc
have a look at the domain and the 4 rent section.
the cbd has 1br studios and 1 br units at 400 per week currently
the gainsburough has 1 unit looks at a wall and is at 400 per week
1 br ???.
redfern 1br is at 380 per week and its on the end of goodlet street next to the burnt out housing commission townhouses and has 9 rent contracts out on it currently.
the park plaza has a studio looking at a wall at 380
I am having a chat with a ljhooker real estate about gazumping a renter
after the deposit was placed and 7 days latter was told to pick up his cheque as the unit was rented to another person and this was a sign contract and deposit in cash.
hot spots any were from the cbd and out
but lock your self in its going to be a rocky ride.
currently the pm for the 1br's are only giving 3 month leases and a 8 week bond and why wouldn't they.
anything that is close to being half decent is gone straight away.
if you are looking at investing in sydney by the end of 2007 start looking now.
and if you want to look at an area
look at kensington,kingsford units and st clair, st marys houses even merrylands for houses.
to find hot spots you need to walk the walk.
240k is alot of money in blacktown as its one place that is hurting the most.
they are selling new units at 220k, that are 3 storey/lift and have a build cost of 270k
so blacktown would not be my first choice at this stage maybe offer 190 to 200 but thats my feel.
my .002

Evolving hot spots in Sydney

Hi,

Thanks for the discussion on this thread

I have an IP in Surry Hills close to the Sydney CBD/Oxford St area, 1 bed, no parking 11th floor with some views 6yo, the rent has been around $350 for some time and has always rented quickly due to location. The rent then went to $360 late last year. Long term tenants gave notice last week so the agent advertised it at $380/w - it went at the first showing on Saturday after 3 days of listing.

Recent sales in this building for similar units have been round the $320-$325K mark (after they settled back from the boom), so the yields in the inner city are definately on the improve...see related link below...

cheers
Michael

http://www.smh.com.au/news/national/landlords-play-catchup-on-rents/2007/01/27/1169788741463.html

alexlee said:

Personally, I'm thinking buy old houses with lots of land in the Parra - Blacktown corridor and think duplexes in the medium to long term. Cater for families who want new houses.

Click to expand...

In the Blacktown DCP, look for corner blocks > 600m as detached dual occs can be sub-divided on these blocks, but other subs require much larger land. But, it's hard to make money unless you can buy very cheap.

There are good rental yields to be had in the inner city part of Potts Point/Elizabeth Bay/Surry Hills, even with the disadvantage of strata fees (which generally range widely from $250-$1000 per quarter). 6% gross is not uncommon.

I'm not a big fan of Blacktown but I do like the suburbs north of Parra for better growth prospects- Northmead, Winston Hills, Baulkham Hills, Castle Hill. Parts of Seven Hills (Kings Langley side and south) are good value, and, though the rental demand may not be as strong as the inner suburbs of Sydney, this area will begin, I believe, to pick up on the back of a severe lack of investment stock over the last few years. It will take time (naturally) but the opportunities are there to be had, if you take the time to look and do your homework. Even better if the vendors are retirees who are dumping property in favour of the big super benefits to be had by the end of this financial year

I'm not a big fan of Blacktown but I do like the suburbs north of Parra for better growth prospects- Northmead, Winston Hills, Baulkham Hills, Castle Hill. Parts of Seven Hills (Kings Langley side and south) are good value, and, though the rental demand may not be as strong as the inner suburbs of Sydney, this area will begin, I believe, to pick up on the back of a severe lack of investment stock over the last few years.

Click to expand...

Jacque.

I tend to agree with your comments in Particular Kings Langley. There seems to be some good oppurtunties in this area worthy of a closer look

Noelc said:

Jacque.

I tend to agree with your comments in Particular Kings Langley. There seems to good opportunties in this area worthy of a closer look

Click to expand...

A sample of recent sales of 3-4 bedders in the sub $500K range on blocks bigger than 600sqm in the suburb:

20 ANDERSON RD, KINGS LANGLEY 4BED, VIEW, 1ENS, 3BATH, 2CAR, 2LUG
$442,000 31/07/06 696 M
31 ANDERSON RD, KINGS LANGLEY 4BED, 1ENS, 2BATH, 2CAR, 2LUG
$475,000 09/09/06 696 M
41 ANDERSON RD, KINGS LANGLEY 4BED, 2BATH, 2CAR, 2LUG
$472,000 29/04/06 696 M
23 COLLETT CR, KINGS LANGLEY 3BED, 1BATH, 1CAR
$395,000 16/10/06 715 M
10 ELLIS PL, KINGS LANGLEY 4BED, 2BATH, 2CAR
$485,000 13/02/06 690 M
14 ELLIS PL, KINGS LANGLEY 5BED, 1ENS, 3BATH, 2CAR, 2LUG
$495,000 22/02/06 690 M
6 GRAY PL, KINGS LANGLEY 3BED, 2BATH, 1CAR
$417,000 28/06/06 702 M
1 HICKS PL, KINGS LANGLEY 3BED, 1ENS, 2BATH, 1CAR
$462,500 09/09/06 697 M
8 HUGHES ST, KINGS LANGLEY 3BED, 1BATH, 1WC, 2CAR, 2LUG
$421,500 23/02/06 699 M
21 HUGHES ST, KINGS LANGLEY
$435,000 08/10/06 693 M
67 HUTCHINS CR, KINGS LANGLEY 3BED, 1BATH, 2CAR, 2LUG
$445,000 23/05/06 705 M
28 JOSEPH BANKS DR, KINGS LANGLEY 4BED, 1ENS, 1BATH, 1WC, 2CAR, 1.5LUG
$455,000 27/08/06 696 M
73 JOSEPH BANKS DR, KINGS LANGLEY
$440,000 16/05/06 696 M
162 JOSEPH BANKS DR, KINGS LANGLEY 3BED, 1ENS, 2BATH, 2CAR, 2LUG
$436,000 12/10/06 697 M
28 KEMPE PDE, KINGS LANGLEY 3BED, 1BATH, 1CAR
$430,000 01/06/06 809 M
9 MARNIE GR, KINGS LANGLEY 3BED, 1BATH, 1CAR, 1LUG
$440,000 25/06/06 693 M
10 MARTON CR, KINGS LANGLEY 3BED, 1BATH, 1WC, 2CAR, 2LUG
$423,500 16/08/06 697 M
25 MARTON CR, KINGS LANGLEY 3BED, 1BATH, 1CAR, 1LUG
$398,000 26/05/06 604 M
31 MARTON CR, KINGS LANGLEY 3BED, 1BATH
$390,000 27/10/06 604 M
2 MERCURY PL, KINGS LANGLEY 3BED, 2BATH, 2CAR
$417,000 04/05/06 645 M
56 MOLYNEAUX AV, KINGS LANGLEY 4BED, 1ENS, 2BATH, 1CAR
$465,000 13/03/06 690 M
26 NICHOLSON CR, KINGS LANGLEY 4BED, 1BATH, 5CAR
$395,000 24/04/06 697 M
45 READING AV, KINGS LANGLEY 4BED, VIEW, 1ENS, 2BATH, 3CAR
$445,000 13/04/06 721 M
103 SOLANDER RD, KINGS LANGLEY 3BED, 2BATH, 2LUG
$402,500 02/04/06 930 M
6 SPORING AV, KINGS LANGLEY 4BED, 1ENS, 2BATH, 2WC, 2CAR, 2LUG
$473,500 29/10/06 690 M
3 STAINSBY AV, KINGS LANGLEY 3BED, 1BATH, 1CAR
$418,000 11/04/06 778 M
38 STAINSBY AV, KINGS LANGLEY 3BED, 1BATH, 1CAR
$416,500 01/09/06 704 M
46 STAINSBY AV, KINGS LANGLEY 3BED, 1BATH, 2CAR
$450,000 12/06/06 699 M
49 WHITBY RD, KINGS LANGLEY 3BED, 1BATH, 2CAR

grossreal said:

hi Noelc

240k is alot of money in blacktown as its one place that is hurting the most.
they are selling new units at 220k, that are 3 storey/lift and have a build cost of 270k
my .002

Click to expand...

Hi Grossreal,
Can you tell me where you saw those new units?
I want to check out their proximity to Wesfield and rental returns
Thanks

Jacque said:

A sample of recent sales of 3-4 bedders in the sub $500K range on blocks bigger than 600sqm in the suburb:

Click to expand...

Yes there are large blocks in Kings Langley but they are mostly older houses and ofcourse with bigger blocks of land, land tax could be an issue.

Also, it's been a while since I drove past the area but from memory I don't recall seeing any units or townhouses.
Could it be that the council wouldn't allow dual occupancies, or apartments in the area?

Also, I noticed that there is no train station there.
The M7/M2 are quite close but the M2 is very busy these days.

BV said:

Yes there are large blocks in Kings Langley but they are mostly older houses and ofcourse with bigger blocks of land, land tax could be an issue.

Also, it's been a while since I drove past the area but from memory I don't recall seeing any units or townhouses.
Could it be that the council wouldn't allow dual occupancies, or apartments in the area?

Also, I noticed that there is no train station there.
The M7/M2 are quite close but the M2 is very busy these days.

Click to expand...

I live in Kings Langley. There are no units but there are some duplexes (newer properties). Most properties are houses and all are brick. Nearest train station is seven hills which is not far away.

Noelc said:

In my opinion the corridor between Parramatta and Blacktown although not considered premium areas is experiencing good population growth and plenty of government/council infrastructure spending.

I,d be interested in other more seasoned opions of this area??

Click to expand...

I am of the same opinion and in particularly the area north of the M2 has been totaly transformed.
With all the big roads, I didn't recognise it when I went there at Xmas time. I also noticed that many large businesses have moved in Baulham Hills/ Bella Vista between Windsor Road and Old Winsor Road.
They are also constructing a buss only road (probably to join Parramatta with Blacktown). Now all they have to do is to make the M2 bigger to cope with all the new housing, or to build a new motorway.

What about Merrylands and surrounding areas. Convenient to shops and train, close to Parramatta and M4?

I think even $200k to $250k for a 2br units there is not bad. For below $300k you can buy a house in Greystanes. I think it's a nice suburb.

Jacque, what do you think of Baulko vs Castle Hill vs West Pennant Hills. Then theres Beecroft and Cheltenham which I put in the same league as upper north shore such as Waitara and Warrawee. The UCVs get up there on these though so you're pretty much done after 2 and thats within one family!

asdf said:

Jacque, what do you think of Baulko vs Castle Hill vs West Pennant Hills. Then theres Beecroft and Cheltenham which I put in the same league as upper north shore such as Waitara and Warrawee. The UCVs get up there on these though so you're pretty much done after 2 and thats within one family!

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In terms of location, at the moment, WPH is better, in my opinion, as it's closer to the railway lines (Beecroft) and most homes in the area are on decent sized blocks. Also held in higher prestige than neighbouring Carlingford, Baulko and Castle Hill.
Castle Hill has both old and newer areas, and is undergoing a lot of change with the Ring Rd around the Towers shopping centre as well as continuing medium density dvpt around the centre. I still believe that it's a major centre, however, and will continue to attract both home owners and renters, as there are many people who work in Parra CBD yet live in these suburbs. IF the proposed North West rail link ever happens between Epping and Rouse Hill (see link here: http://www.tidc.nsw.gov.au/Documents/757_NWRLplanupdate.pdf ) as it is supposed to over the next 7 yrs then the area will increase overnight in demand and prices will rise. Of that, I have no doubt. The NorthWest is also the fastest growing residential area in Sydney right now, with one of the lowest unemployment rates as well.

Baulkham Hills has traditionally been classed as the "poorer" neighbour of Castle Hill. However, with the Norwest Business Park such a success and a major shopping centre about to be constructed in Rouse Hill, BH suddenly finds itself quite close to all the action and you can see evidence of gentrification with lots of houses being rendered and renovated. Not in all parts of BH, but certainly in some sections. Knockdowns and rebuilds are becoming more evident as well. Big blocks abound in the older areas and are very popular with first home buyers in the sub $600K bracket. Lots of stock at the moment too.

The Beecroft area has the advantage of the Epping railway line and it's Copeland Rd East is home to some spectacular old historic properties, all an easy level walk to the nearby station. Cheltenham is similar, and some of the streets manage to maintain a real village feel, despite the fact that they are near rail. I like these suburbs too, and feel that they represent good value for money compared to suburbs on the North Shore line such as Turramurra and Wahroonga.

And as far as land value goes, the dreaded land tax won't let you off easily here with many blocks in these areas easily exceeding the current $352K threshold. Not much that can done about that, until state govt policy is changed!!

Winston Hills is it worth investing in?

Just reading some of your thoughts re Western Sydney!
I thought I would give you my perspective as long time resident of Winston Hills !

My parents bought there 3 bedder at Winston Hills in 1968 for $17,000, it was a 3 bedroom red brick on a 900sq plus cnr block. It is now a 6 bedroom and they still live there (I think mum will be carried out in a box).

I am now renting in Winston Hills , it is a stock standard red brick probably around 700sq , I have two parks in my street and I am close to a small group of shops, I have a 5 min walk to bus to Parra or City. I am close to M4,M7,M2,. I pay 320 per week, this is cheap compared to other rentals in the area. What I have noticed is a change in demographics all the older people are selling up, or dying which ever comes first. I have noticed alot of young couples with prams and money as the old red bricks are getting rendered, knock down and rebuilds etc.

We have a resonable sized shopping centre and 5 mins to castle hill shops/ Baulkham Hills (currently under expansion) and 15 mins to Westefeild Parra.

Winston Hills has many bushland areas to walk, parks and reserves. Parramatta as would know has just completed its transport interchange and Westefield expansion. We are still waiting for the Civic Centre transformation!

Parramatta will soon have an infux of public servents as you may be aware we have the Police headoffice, Sydney Water is building there head office out here, I work in the Macquarie tower which is full of public serv including myself. We have the Family Law and Law precinct expanding and on and on the growth goes of Parra. It has changed since the 80's when I hung out and wagged from school.

I guess what I am trying to say that Winston Hills has a great opportunity and I am sure properties will do very very well over the next 10 years or so. I have noticed that houses sell fast and rentals are hard to get!

It takes me 20 mins on the bus and 24 minutes to cycle!

feel free to ask me any questions on the area, I will answer questions if I know!

In fact I wish I could afford to buy in the area!

Bellosky

Bellowsky, but at a rent of $320 the property must be worth in the $400's? That's a lot of holding cost. Yields are a big issue especially when you first build a portfolio. While I also think that area will do well in 10 years, the question we have to ask is: how can I afford the most property? Yield plays a big part of that.

e.g. would you rather have $1m in property growing at 5%, or $500k in property growing at 8%?
Alex

hi bv
sorry to say can't tell you the address of the blacktown units as it was bought private and was done thru a group and they would not like me to put it on a board.
but there are others and they are buying.
boards are great inventions but i don't buy off them nor do I get very many deals as they are already done by the time they hit a board.
there are deals in blacktown as there are deals in kingsford you just have to find them.
happy hunting
if I was going hunting
have alook at liverpool at the moment
I think a bit better the parramatta and possible good growth once the excess has been soaked up.
My .002

grossreal said:

hi bv
sorry to say can't tell you the address of the blacktown units as it was bought private and was done thru a group and they would not like me to put it on a board.
but there are others and they are buying.
boards are great inventions but i don't buy off them nor do I get very many deals as they are already done by the time they hit a board.
there are deals in blacktown as there are deals in kingsford you just have to find them.
happy hunting, if I was going hunting, have alook at liverpool at the moment
I think a bit better the parramatta and possible good growth once the excess has been soaked up.
My .002

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G/REAL
Yes I noticed some on fifth avenue but they are big blocks of units,
I think it doesn't matter where I buy because the fundamentals will be right, e.g close to the train station, shops, schools etc. I also have a budget to stick to so I don't want to go too low and I can't go too high either or I won't have enough deposit to avoid the LMI. Ofcourse I also want to minimise my holding costs so my other concern is land tax, (hence my sudden interest in units which are not normally my cup of tea. Yes I did look at Liverpool. Prices there have come down a lot but returns are still low and there is a high supply of units in the area, so I couldn't decide what to do.

I am still looking but I think Quakers Hill is my best bet, I've been looking at different areas but I keep on coming back there because it's in my price range and it has the right fundamentals. Train station, direct access to M2 and M7, good schools, University, and not bad demographics. I've already bought 2 IP's there (on the new side) and I haven't had vacancies for more than a couple of weeks every 2-3 years. cheers

if I was going hunting
have alook at liverpool at the moment

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Gross Can I sak why you would go hunting in Liverpool??

Is it because prices have drop signifcantly out this way??