Frank opinions about main road property

M

mech81

Hi guys,

Just viewed this lovely property today
http://www.realestateview.com.au/Re...operty-Details-buy-residential-2973149_S.html

Overall, this unit is basically what I have in mind for staying in for a year and then turning it into an investment property. Vendors are looking for around 460-510k mark at auction (which I think means 530k really). Great location, its in a premium suburb and very near to public transport and the freeway access.

There's one thing about the property that is rather a deal breaker but my partner says its not. Its on a main road and its a main link road between neighbouring suburbs. I can literally hear every car pass by as the road outside is coarse chip road. My partner said we could glaze the windows and put more insulation in to cut out the road noise which is something i have no argument with (she quite likes the place and i think is getting emotional with it).

My question is does a busy road like this affect price valuation and rental in the future? Does putting in window glazing and all those in your experience make potential buyers and renters ignore the fact that it is on a busy main road?

Am happy to have other opinions of the proeprty as well.

Cheers guys
 
I would be wanting a large reduction in price to compensate for the main road. Maybe the price already is already discounted due to the main road. If this was one street back from the main road, what would you think it is worth?

Don't forget that one day you will want to sell it, and the pool of potential buyers will be reduced due to the main road, just as the pool of buyers would be reduced right now.

To have to double glaze or spend money making it quiet would be a waste of money in my opinion, as it is not seen as an "improvement" but seen more as making it "livable". I see it as being the same as re-stumping and re-roofing, necessary but not improving the price or rent return available.

Many people will not even consider buying (or renting) on a main road, even if you have spent money making it quiet.

Just my thoughts anyway.
 
my names not frank but I'll give an opinion.

price price price.

it will command less rent, sell for less, have higher turnover of tenants, be difficult to sell in a soft market. if you can get it at a steal then might be worth considering.
 
Agreed. Was looking at blocks in a new division. There was 30k difference between several the same size. The only difference was some were beside a main road.

There was a house at lockup stage beside the road. Narrow front windows, double glass. While I am sure carpets and curtains would have improved it the road noise inside was enough to make me decide to look elsewhere.
 
Sometimes its the only affordable way into a suburb that you want the kids to grow up in, be in the school catchment area etc. For a PPOR this may be one of your major criterias.

Generally a main road property will be worth less than one even a few houses down a side street. You take a price hit on resale, but so has teh vendor you are buying from currently.

I used to live in an apartment on the pacific hwy in Killara. It was top floor back of block and so had far less noise than others in the block. The highway address did pull its price down a bit compared to, say, an apartment directly behind it in a side street, by maybe 20-30k.

However in the 6 years I owned it, it appreciated well in value, in line with the market % in general, and when I sold it released a couple of hundred thousand which was reinvested elsewhere. It sold in a week last year.

For me though, if its purely for investment, I would be looking at something besides main roads. Rents are typically less so gross return suffers. You get a higher churn rate as people can move on due to the noise. For that kind of cash, find a solid bones older house, live in it, reno it over the 12 months (nothing crazy, just give it a tart up) then rent it out.
 
Not Frank, but here goes....

Know that area quite well as have some family and friends who live in Glen Iris. Not quite a main road, more like a larger secondary road imo. The price will presumably reflect its position and location - I can't comment on the price as I don't have comp sales knowledge about that area.

Other posters have made the comment about if this was in a more traditional residential street, what would be the price difference. At least $50k imo. I don't think its a relevant comoparison imo, because its market price and presumably what you might pay for it will reflect its current position/location. It will always be cheaper and will always have a smaller pool of people attracted to it because of this. Like anything, if it has the features you/tenant want, its then all down to price.

But if you are off put with road noise, then stay away. I lived for a while in a 2 bedroom flat on a busier road than Tooronga Road admittedly. No double glazing and it became to grate over time.

It was harder to rent but not harder to sell, counter intuitively. Double glazing won't make any difference to renters or rental price but could make a difference to prospective purchasers. My guess is that the furniture looks hired, so don't get drawn in by these accoutrements.

However one difference to where I was living is that this has mature trees at the front which would block some of the noise and of course I am not sure of the orientation of floorplan and if its the living room that is at the front. You will be spending most of your time (or the tenant would), so bear that in mind.

You might find that during peak hour, the traffic is slower and not as noisy as non-peak times. Most of that traffic would be passenger vehicles so you wont' have B doubles thundering down the road. If you are serious, go down at different times to hear and see the traffic. The two times for the OFI are Wednesday at 11.30 and then on Saturday at around the same time. If you can go to both, that would be good to see. Of course, most people work at 11.30am so the issue of road noise may be irrelevant at that time.

Good luck.
 
Tooronga road is a secondary road used to cut thru from Camberwell into Malvern/Caulfield when you want to avoid the freeway traffic.

It is busy during peak hour but the traffic is slower due to the train crossing. I don't think its massively busy at other hours or the weekend. There are a lot less trucks than on Burke Rd.

It'll come down to price.
 
I am 99.9% against buying main road properties for IPs. The 0.1% would be particular streets like parts of Toorak Road - Or where a property type & area are rare enough to counteract most of the downside.
Is there that much rental demand for this type of property? I would work out how much you'd need to discount the rent (be ruthless here) and then hope the price is discounted enough to match.
 
Thanks for your replies guys. My partner and I will be heading there this evening during peak hour to have a look see how much road noise there will be. Its a pity its the unit facing out on the road (nice frontage though). I would have been more tempted had it been one of the inner units. Quoted price from the REA 460-510k. Comparables are around the 530k mark. Maybe i'll just wait for auction and see what the response is like and swoop if there arent any takers. A bit more time to do more due diligence.
 
Hi mech81,

I drive past this on my way to work & work in the general area.

Buzz is right; it's more a secondary rd. It does get really busy at school times with people heading up to Bialik (don't know if I've spelt it right?) college just over Toorak rd. Bit busy with cars heading to the fwy off Toorak rd too. It's busy in the morning & afternoon peaks, but cars are not roaring by, it's a slow crawl most of the time.

The location's fab! (I'm not a fan of main rds either, but this isn't Warrigal or a 4 lane rd). It's a really nice area & you have access to lots of parks. There's the big shopping centre on the crn Toorak & Tooronga rd. Great schools. Transport links. You're close to Glenferrie rd & Camberwell junction / Burke rd.

Perhaps in this market you could talk the agent down a bit?

It looks like it's the lounge room that fronts the street & the bdrms are a bit further back. Buzz also correct that you won't have B-Doubles thundering by. I reckon it would be fine sleeping there.

Let us know what you think once you visit it :)
 
Hi Mech81,

I purchased a property 11 years ago on a secondary road which wasn't too busy at the time of purchase. I recently put it on the market and had a lot of people through who commented how great the place was BUT it was on a main road. (People are attracted to the lower price compared to comp properties in better streets but they still dont buy). After 8 weeks we received an offer which was very low and ultimately sold for 10% less than someone would have paid if it was a street back from the main. Mine was also the front villa of a small complex, was larger than newer builds and had a lot of land on title, front and rear.

Unless there was significant upside, I personally would not be eager to purchase on a busier road again as a result of my recent experience.

Having said that, it is more acceptable for inner ring suburbs and buyers will overlook main road if they fall in love with the place or if the place has a major advantage over other nearby units.

You will need to be aware that you will sell for less than comps in other nearby streets and you will have less buyers competing for the property, hence lower prices.
The Auction coming will be a good indication for you if the road is deterring other people. It is a FHO price, so there still might be first home owner competition which will see it yield a good result.
 
imho i wouldnt even consider it and for that price???? hah! hell no! i worked o tooronga shopping centre on the corner there and worked o the apartments in there they were wanting 500-700k for a little dogbox thats held up by metal studwork! even though the developmet was 120 mil but nevertheless. if i were you i would be walking away! tooronga road is a shocker try 6-7am cars n trucks thunder down the hill!!!!!
 
I think the posts above are more than enough evidence that main road properties aren't good investments. The only exception being if they're a) commercial properties or b) large development sites.
 
mech81 said:
Hi guys,

Just viewed this lovely property today
http://www.realestateview.com.au/Re...operty-Details-buy-residential-2973149_S.html

Overall, this unit is basically what I have in mind for staying in for a year and then turning it into an investment property. Vendors are looking for around 460-510k mark at auction (which I think means 530k really). Great location, its in a premium suburb and very near to public transport and the freeway access.

There's one thing about the property that is rather a deal breaker but my partner says its not. Its on a main road and its a main link road between neighbouring suburbs. I can literally hear every car pass by as the road outside is coarse chip road. My partner said we could glaze the windows and put more insulation in to cut out the road noise which is something i have no argument with (she quite likes the place and i think is getting emotional with it).

My question is does a busy road like this affect price valuation and rental in the future? Does putting in window glazing and all those in your experience make potential buyers and renters ignore the fact that it is on a busy main road?

Am happy to have other opinions of the proeprty as well.

Cheers guys
Click to expand...

that's not a main road. i lived on tooronga rd for a couple of years.

As for the steel stud wall comments - for those apartments on tooranga - big deal everyone does it.. from the high end to the low end only coz the studs are 70mm as opposed to 90mm. doesn't make a big difference.

you could just double glazed all the windows and you will see the difference.
 
Volume 2 - Chapter 14

"Things you'll never hear at a Real Estate Agent's office"

"hi, i'm looking for a property to rent"

"certainly - would you like a list of available properties to rent?"

"if you could narrow it down to just those properties on a really noisy, busy street that difficult to get in and out of at any time of day, preferably near a traffic light so i hear tyres screeching and cars smashing all night, maybe even opposite a bus stop so i can get my garden trampled - that'd be great"
 
Even on 'main roads' like Mont Albert road in Camberwell/Canterbury - the houses are set so far back from the main road that it negates the problem to an extent
 
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