Auburn?

[jmillar]

I've seen basic 2bdr units in St Marys/Werrington sell for $230-240,000 and it's difficult to find something in Penrith under $240-250,000 renting for $300/week.

In Auburn it looks as though you can pick up a basic 2bdr unit for $280,000 which rents for $360-370/week such as the one below:

http://www.realestate.com.au/property-unit-nsw-auburn-114239883

This represents a good return and $280k seems cheap for something 20km from the CBD, no?

What are your thoughts on the area?

 

[Granny]

Auburn?
Hmmmmm let me think.

Close to Parramatta, Sydney Olympic Park. Within 30mins to city and practially any significant place in Sydney.

Has most shops covered e.g. Woolies, BigW, Costco, Factory Outlets, Harvey Norman. Some nice food spots.

Plenty of Schools of various religions and also public schols around (Auburn Girls now partially selective).

Has lots of medical centres and its own hospital.


Sounds great!!

I'm guessing the downside is the people. Nothing to do with race as there are a variety and well balance of mixes but I beleive its because the people there may be (not always) of lower sociaeconomic status as it seems quite high density housing there also.

E.g. I saw somehere on youtube maybe 2 men fighting over a trolley for the potential to extract $1 or $2 coin. People of higher sensibility would realise its not worth an injury.

 

[EN710]

I dunno if for investment (haven't look at the area), however, were looking into the area for renting last year - historically have many crimes happening and not so much nowadays (hubby checked the NSW police news).

 

[Edmond Dantes]

Hmmm... What are the rates, etc. Any idea on sinking & admind fund? Rates may be more expensive than out west?

 

[jmillar]

Look at the median price compared to its surrounding suburbs...
http://www.investsmart.com.au/Property/NSW/2144/Auburn

7% yields for a suburb as well located as Auburn is surely can't be a bad long term investment. Sure it's got a bad reputation now but so did Abottsford, Redfern, Burwood etc decades ago...

I think a 7% yield purchase in Auburn would be a much smarter buy than a 7% yield purchase in Mt Druitt or St Marys.. Am I missing something??

 

[Edmond Dantes]

I have your same thoughts and will wait until someone points out something wrong. Look at Lakemba as well.

 

[glk2000]

what about strata? I saw in bankstown a 350k unit has a strata of $800s. so it means it would take a average 2weeks to make it back. Fairfield was more ridiculous 1 had $1000 strata on it. as a investment I don't like the idea of such high strata.

 

[jkat]

My two cents, I don't know if this is a good area to invest or not but speaking from the viewpoint of someone who does a lot of work with families in the area:

Auburn has very high unemployment rates - higher than the average in Sydney. It is part of council's plan to lower this but I don't know what they have in place to achieve that. Part of the unemployment figures is the fact that it has high refugee population.

Also, there is a lot of problems with youth - drinking, drugs, disengagement from community, vandalism and violence.

High migrant and refugee populations - not sure what is going to happen to the refugee population of Auburn with Rudd's new policies (in terms of numbers and affordability for them to rent).

Also - in terms of units, many families that I work with rent a 2bdrm unit - as that is what they can afford- and it ends up having a lot more people than is safe/desirable living in the unit. This would come down to the property manager to deal with but good for you to know that it is common. The most I've seen is mum, dad, mother in law and 3 kids in a two bedroom unit.

 

[Edmond Dantes]

Jkat, i'm not really worried about those things. What I'd be interested to know is the vacancy rate, rates, etc. Get yourself a good landlord inaurance and pray nothing happens.

Mt Druitt has/had all the characteristics you mentioned, and it's boooominggg.

 

[starter]

I've seen basic 2bdr units in St Marys/Werrington sell for $230-240,000 and it's difficult to find something in Penrith under $240-250,000 renting for $300/week.

In Auburn it looks as though you can pick up a basic 2bdr unit for $280,000 which rents for $360-370/week such as the one below:

http://www.realestate.com.au/property-unit-nsw-auburn-114239883

This represents a good return and $280k seems cheap for something 20km from the CBD, no?

What are your thoughts on the area?

I like Auburn's prosimity to Parra and the CBD, however, the yield is lower than further out West and this place isn't indicative of market rent. I've spoken to the agent about this unit previously and it's a situation of 5 guys sharing the apartment, hence the inflated rent. Market rent I would put at $300-320.

 

[tang]

what about strata? I saw in bankstown a 350k unit has a strata of $800s. so it means it would take a average 2weeks to make it back. Fairfield was more ridiculous 1 had $1000 strata on it. as a investment I don't like the idea of such high strata.

ffld? 1k strata? per annum or per quarter?!??

 

[ZachAnSel]

I like Auburn's prosimity to Parra and the CBD, however, the yield is lower than further out West and this place isn't indicative of market rent. I've spoken to the agent about this unit previously and it's a situation of 5 guys sharing the apartment, hence the inflated rent. Market rent I would put at $300-320.

That's the common practice in Auburn. Much better to buy house and land in Auburn than unit, yes yield is low but awesome CG in 1-2 years

 

[jkat]

Jkat, i'm not really worried about those things. What I'd be interested to know is the vacancy rate, rates, etc. Get yourself a good landlord inaurance and pray nothing happens.

Mt Druitt has/had all the characteristics you mentioned, and it's boooominggg.

Yes it is similar to Mt Druitt and surrounds.... for me the big BUT would be whilst Mt Druitt may also have high unemployment it would be for different reasons.

Whilst I agree about getting a good PM and landlord insurance; for me unemployment is a factor because if people aren't employed (and aren't eligible for centrelink/government benefits and support which refugees are not...) then it makes sense (to me at least) that it would impact on demand...and would therefore impact vacancy rates.

 

[jaspn]

I did a bit of footwork in Auburn the other day around the blocks near Westfield. My observations were:

- Poorly kept common grounds (looks like they weren't being looked after)
- Mostly middle eastern population
- I felt safe enough to walk around at dusk
- Would happily buy here with a 250k-300k budget due to the proximity to the city for a CG play

Rental yield isn't that of Mount Druitt for instance, but some seem to think the CG will be strong considering location.

 

[Ajax]

The main renters will be Islamic (Turkish, Iraqi etc), Indians and Chinese. There are also some Africans here (I think Ghanaians). Looks like the first place many settle when the arrive in Australia.

The area improved a lot since I purchased in 2007 for 172k. (I sold in June last year with a 50% capital gain).

The selling agent when I bought the IP said (afer I'd signed contracts)...85% of the time you won't have trouble with tenants. That proved correct as I had to go to Residential Tenancies Tribunal with rent unpaid for 3 months and was threatened by the tenant in the conference room. Tenant was a bit on the small side to have me that worried. Landlord Insurance (about $330/year) is highly recommended. Be careful with tenant selection (the other tenants were fine-young families building a future in Australia. All I could do was admire their determination).

 

[jmillar]

Thanks guys. Some useful stats from a University assignment I'm doing currently:
- Auburn City Council is the 2nd highest on the SEIFA disadvantaged list for Metropolitan Sydney (after Fairfield)
- 54% of residents are from non-english speaking backgrounds
- 8.6% unemployment (5.7% average across Greater Sydney)
- highest percentage of refugees in NSW end up here

Anyhow, the consensus seems to suggest that the yield is not bad, the tenants are less than satisfactory but there seems to be very good potential for capital growth once the area is gentrified.

 

[WigansAFC]

WAIT!!!!!!!!!

Jmillar, you're 21 own a IP (looking for a second) and at uni?!?!

Well done! Sorry if it sounds stalkerish but congrats for the hard work

 

[jmillar]

Thanks WigansAFC, I appreciate the encouragement. I'm also doing a Cert IV in Property as well as part time uni and full time work

Enjoy your night.

 

[tang]

Thanks WigansAFC, I appreciate the encouragement. I'm also doing a Cert IV in Property as well as part time uni and full time work

Enjoy your night.

congrats Jimillar admire your enthusiasm. why dont u do the diploma?
please let us know once you have found a suitable property