Green in the Perth market

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Ingle Farm 12 km from Adelaide CBD

A property like this 12 km from Perth CBD your looking at paying 100 k more for!! This one in Ingle farm asking price $240 k & it's a house!

I wonder what that Ingle Farm property would rent for?

I have no idea though if it's a nice neighbourhood or anything about that suburb whatsoever or anything about Adelaide but you would think it would have some reasonable CG in the future being just 12k from cbd and it looks good value for money with a good yield. Also the land tax issue. If I have all my properties in WA I'll be paying more land tax

What do people think of this plan ? and what about Ingle Farm?

Rent for $280-350p/w pending condition and renovation.

Ingle farm is going through some nice gentrification, alot of the older big blocks knocked down and nice new houses built.

If you have question regarding Ingle Farm, maybe start a new thread or ask in the Adelaide Investment Suburbs thread http://somersoft.com/forums/showthread.php?t=93019

Adelaide has some very good value for inner city suburbs inside 20km from city with development potentional, but its definitely heating up like most of the country for similar products.
 
I'm starting to understand this now.

I bought in Perth in 2008 & then again in 2009 but in hindsight the Perth market was either still at the top back then or had levelled off & prices were static. I had no growth until about 1-1.5 years ago which meant for a few years I was NG and was stuck waiting for CG to happen. I couldn't invest because of the lack of growth. Now if I had bought my first ip over Melbourne at the end of 2009 I would have done much better as it was a rising market & a fast moving market too! It's finally sinking in for me.

This time round I should not be investing in Perth as Perth already started moving quite a while back. I haven't missed out on Perths growth though as I have exposure in the market. I'm thinking Brisbane & Adelaide are rising now so I guess I can't go wrong if I follow what other ss are investing in!

I am not confident to buy myself over east. I wouldnt want to f@&$! up something so big like this. This would be a good opportunity to learn from a buyers agent I'm thinking. It could well be worth the fee charged. I need something neutral or better and want to catch the wave of a rising market for immediate CG not have to wait 3 years like last time!

You got it.
The last major boom cycle in Perth was from 2001-2006/7, property prices tripled in some cases even more because the cycle was a mother of all cycles, generally they don't last this long. Interest rates during this period were not 5% perhaps 8.5%, so if you get the timing wrong its no fun... you will be burning your money, holding costs and no growth is a killer.

In 2008 GFC the Melb market went ballistic, auction clearances were very high 85-90% and this went on for about 2 years, once again it then fell back, though in the last 12 months Melb inner city has seen considerable growth.

Back to Perth market today, yes there has been double digit growth over the last 2 years, however the market is still very strong.
I still think there are some great opportunities, I am jumping in again trying to secure another development site.

I would be buying properties in your price bracket that are very sort after as mentioned anything earmarked for rezoning. Agents can not get enough stock in Beechboro at the moment, I would look at areas 12-15 km from Perth and properties that are unique where you can add value down the track. Once zoning is ratified then you can review. If you buy low entry level with current interest rates it should not be too difficult to hold these properties.

Investing around Australia is one way to capture growth, currently I am tapping into equity gains in Sydney which is great, Syd west has actually been moving for the last 2 years, hoping that I can do the same with my Melb, QLD property over the next 6-12 months.



Cheers
MTR
 
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Back to Perth market today, yes there has been double digit growth over the last 2 years, however the market is still very strong.
I still think there are some great opportunities, I am jumping in again trying to secure another development site.

I would be buying properties in your price bracket that are very sort after as mentioned anything earmarked for rezoning. Agents can not get enough stock in Beechboro at the moment, I would look at areas 12-15 km from Perth and properties that are unique where you can add value down the track. Once zoning is ratified then you can review. If you buy low entry level with current interest rates it should not be too difficult to hold these properties.


MTR

But if I buy a house with potential for rezoning and / or to add value, I would be NG for a while wouldn't I? I guess if I fix the rates it wouldn't be soo bad.

Re: houses earmarked for rezoning are and will be sort after. Is that because once it is rezoned the property value will automatically increase in value so I'll develop equity sooner rather than later?

I'm not sure but I could probably afford something no more than $350 K but I'll have to check with MB.

What would be my options though after it is rezoned? I dont really have the funds to put through a development application to subdivide. Is there a way to make money without having to go through that process. Perhaps I could buy a property with the hopes it will change zoning and sell the property once it has been rezoned? Could that be an option for me?


Also

I've just been looking at something like this tuart hill property and its 2 beds which is good. (over 50 sqm which is what im after)

http://www.realestate.com.au/property-unit-wa-tuart+hill-115760395

Fully renovated 2 bed tuart hill

Maybe I need to have another look at my goals and what I want out of my investing. Maybe i'll be happy to be a bit more conservative in my approach and purchase every few years when i can afford it. I dont plan to retire till i'm 60 so i'll easily be able to get at least 7 properties by then. I'd like 10 ip's. At this point i'm a bit more conservative than some people on here and I'm ok if it takes me 20 years to get there. I dont mind getting rich slow in other words. I dont think I can go wrong with a regular buy and hold. It'll just take me longer to get there than some other people, but I think i'd be ok with that. All I know is is that I cant be too NG for this one.

thanks for your help! :)
 
All I know is is that I cant be too NG for this one.

You can buy properties that are cashflow neutral/positive that also have development/high growth potential. They obviously are just a lot harder to find. But its pretty much my criteria and I've had some success find these around Perth every now and again.
 
You can buy properties that are cashflow neutral/positive that also have development/high growth potential. They obviously are just a lot harder to find. But its pretty much my criteria and I've had some success find these around Perth every now and again.

I am going to start getting out there and going to home opens. :)
 
You can buy properties that are cashflow neutral/positive that also have development/high growth potential. They obviously are just a lot harder to find. But its pretty much my criteria and I've had some success find these around Perth every now and again.

just something to add, i saw you mention low ball strategy, if you ever did come across cash flow neutral/positve with growth potential, i don't think its best to low ball now because the current market you snooze you lose. lots of people looking at the same things you are after.

i learned my lesson, misse dout on a nice (future retain and build) in beechboro because i didn't want to go up a bit.
 
just something to add, i saw you mention low ball strategy, if you ever did come across cash flow neutral/positve with growth potential, i don't think its best to low ball now because the current market you snooze you lose. lots of people looking at the same things you are after.

I do see your point, but I never buy into the "I might miss out" mindframe. I'm a firm believer that there will always be another deal out there. It helps that my strategy doesn't rely on timing the market - its simply to buy under market to begin with.

And so I simply offer what I am prepared to pay and then hope there is not much competition. Sometimes you'll lose out, but sometimes you'll get a really good deal.

It has worked out for me particularly well once, when I beat out other offers $20k above mine because I offered unconditionally, not because I raised my offer.
 
I do see your point, but I never buy into the "I might miss out" mindframe. I'm a firm believer that there will always be another deal out there. It helps that my strategy doesn't rely on timing the market - its simply to buy under market to begin with.

And so I simply offer what I am prepared to pay and then hope there is not much competition. Sometimes you'll lose out, but sometimes you'll get a really good deal.

It has worked out for me particularly well once, when I beat out other offers $20k above mine because I offered unconditionally, not because I raised my offer.

Apologies, was actually directing my statement to alex and wanted to quote you.

Just to share my recent experience tho, tried low ball offers as well, however, even cash offers at exact asking price and i still lost out on about 3 offers. Would not happen couple years ago i think. Not to mention sunset clauses are useless recently, because agent knows theres always someone willing to rush in the rising market. Thats why i suggested if something truly exceptional shows up, dont low ball.
 
Apologies, was actually directing my statement to alex and wanted to quote you.

Just to share my recent experience tho, tried low ball offers as well, however, even cash offers at exact asking price and i still lost out on about 3 offers. Would not happen couple years ago i think. Not to mention sunset clauses are useless recently, because agent knows theres always someone willing to rush in the rising market. Thats why i suggested if something truly exceptional shows up, dont low ball.

When you have a hot market you go full asking price as there will be more than 1 offer on the table in this market, in particular potential deve sites. The way I look at it is you will be capturing growth $5000 either way is chicken feed especially in 6 months time, demand is stronger than supply, it can only go one way ..... up:)
 
Low ball, at asking price above are all really irrelevant.

You need to know the market you're purchasing, who you're purchasing from and why they're selling. Once you know these you will be able to determine value, the asking price is just an indication. Once you know the value of a property what they're asking is really irrelevant as you only need to know what you would pay, if the asking price is under that's a bonus... But as already mentioned before even offering that doesn't ensure you get the property.
 
When you have a hot market you go full asking price as there will be more than 1 offer on the table in this market, in particular potential deve sites. The way I look at it is you will be capturing growth $5000 either way is chicken feed especially in 6 months time, demand is stronger than supply, it can only go one way ..... up:)

Bang on! $5,000 on a development site is peanuts, if $5k extra is going to throw out your profit margins then you shouldn't be doing it in the first place. Nothing wrong with offering at asking price or above if it's worth it. $5k or a little bit more isn't going to hurt the valuation either.
 
Apologies, was actually directing my statement to alex and wanted to quote you.

Just to share my recent experience tho, tried low ball offers as well, however, even cash offers at exact asking price and i still lost out on about 3 offers. Would not happen couple years ago i think. Not to mention sunset clauses are useless recently, because agent knows theres always someone willing to rush in the rising market. Thats why i suggested if something truly exceptional shows up, dont low ball.

Yeah I get your point. I guess I'll play it by ear & see.
 
Bang on! $5,000 on a development site is peanuts, if $5k extra is going to throw out your profit margins then you shouldn't be doing it in the first place. Nothing wrong with offering at asking price or above if it's worth it. $5k or a little bit more isn't going to hurt the valuation either.


I agree with this but unfortunately some people get caught up in the ego of it all and wanting to say that they got it $50k off asking or that they would never pay full asking or whatever when it really means nothing without context
 
I agree with this but unfortunately some people get caught up in the ego of it all and wanting to say that they got it $50k off asking or that they would never pay full asking or whatever when it really means nothing without context

Yes $50k off asking price doesn't mean you got it $50k below market value, property could of been $100k overpriced to begin with.

Which is why low balling doesn't really have too much to do with BMV.
 
If anyone finds a development site for $350K let me know, I can't see how anyone can expect to neutral/positive gear a dev site when they are being sold at a much higher price, ie $700K for something with a house that would rent for $400 week max. Have been looking Bassandean, Belmont, Cloverdale, Kewdale, (my areas of comfort) - even Lockridge, Eden Hill, Beechboro, Girawheen - for slightly less. Am going to start a development in Perth thread and show a few examples. Dev sites go for much more given *potential* for future gains.
 
Perhaps Armadale, Kelmscott, Gosnells, Medina... cheaper areas.

Agent tells me you can pick up a 5 unit site in Armadale for $400-450K, I am not looking at this market so have no idea. However, you can purchase in $300s in Medina, house on large block over 900sqm duplex site, and build at rear.

Cheers
MTR
 
Bang on! $5,000 on a development site is peanuts, if $5k extra is going to throw out your profit margins then you shouldn't be doing it in the first place. Nothing wrong with offering at asking price or above if it's worth it. $5k or a little bit more isn't going to hurt the valuation either.

Agreed. I had to pay (shock, horror, gasp) $5,000 more on my last block but the end sums of course still work. It was kind of a ridiculous minuscule counter offer on a $1m site :rolleyes:

There are sites which are over priced but if you have a different vision for them they work. $500k for a single dwelling 250sqm block in Highgate was a new high and as a single dwelling it would not make money for me HOWEVER as a duplex or 3 apartments it makes money.

Know your market, know your options, know how to do good due diligence
 
That's interesting. I had an offer on this property for $350,000. agent called and said vendor wanted $355,000. I said no. Rang back within 2 or 3 minutes and agreed to go up $5,000. Agent said it just sold to someone else. Says here it sold for $350,000. ????? Nasty!
http://www.realestate.com.au/property-house-wa-beechboro-108883166

it says finance fell through the first time so it looks like it resold for $350k. doesnt sound like anything nasty.
 
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