Ideas for capital growth

[menty]

What do you guys suggest would be worthwhile for about a 400-600K budget?
My initial plan was to get a house with land and build a granny flat on the back (replicating my initial investment strategy).

However, with the market in its current state I'm not really sure what to do. Perhaps it may be better to simply buy and hold a house with land or a unit while the interest rates are low. Ideally, Id be after something neutrally geared to slightly positive (if possible)

What are your thoughts on the following areas:
House with land:
- Bankstown area (Yagoona, Sefton and surrounds).
- Blacktown area (but this seems overpriced now?)
- Berala/ Regents Park. (I live here and have seen the prices of houses shoot up recently).
- Carramar/ Fairfield (good development potential and allows me to build granny flat etc)

Unit:
- Lidcombe (There have also been a few OTP units that have started to be developed around the station and they have all sold out quickly. ),
- Parramatta (I still believe that Parramatta will start to develop into a 2nd hub)
- Lane Cove/ North Sydney
- Surry Hills
- Fairfield NRAS apartment.

 

[saiman]

Hi Menty,

Hope your granny flat is doing well...

Personally, I am steering well clear of anything in Sydney at the moment....As a professional investor, its not worthwhile competing with the flock of sheep public who buy emotionally driven by a FOMO (fear of missing out) mentality..... some say Sydney has still got a while to boom but signs indicate that brisbane will be following closely behind where you can still pick up bargains near the bottom of the cycle without much competition (cashflow as a bonus)

If you must buy in Sydney, I feel the campbelltown region is slightly lacking behind the rest of the Western Sydney hype

 

[Rolf Latham]

but signs indicate that brisbane will be following closely behind where you can still pick up bargains near the bottom of the cycle without much competition (cashflow as a bonus)

not in any nearish city burbs, multiple offers, sales well above intial list price and agents getting arrogant again, suggests the brissie market has bounced well

ta

rolf

 

[menty]

Hi Menty,

Hope your granny flat is doing well...

Personally, I am steering well clear of anything in Sydney at the moment....As a professional investor, its not worthwhile competing with the flock of sheep public who buy emotionally driven by a FOMO (fear of missing out) mentality..... some say Sydney has still got a while to boom but signs indicate that brisbane will be following closely behind where you can still pick up bargains near the bottom of the cycle without much competition (cashflow as a bonus)

If you must buy in Sydney, I feel the campbelltown region is slightly lacking behind the rest of the Western Sydney hype

Thanks

I'd like to think the granny flat is doing well. But I can't be sure until I get a valuation done on the property. In terms of rental yield and tenants, its doing great.

 

[MTR]

not in any nearish city burbs, multiple offers, sales well above intial list price and agents getting arrogant again, suggests the brissie market has bounced well

ta

rolf

Hi Rolf
Any idea on how Gold Coast is going??
Thanks

 

[spludgey]

Ideas for capital growth

- Fairfield NRAS apartment.

Am I missing something here? I would have thought that an NRAS apartment is very poor for capital growth, especially in the first ten years.

 

[jaspn]

not in any nearish city burbs, multiple offers, sales well above intial list price and agents getting arrogant again, suggests the brissie market has bounced well

My brother is a FHB looking in Morningside, Bris, up to 400k price range. He reports properties are being sold within a day, with massive turnouts at open homes. His comment on prices is stock is being sold for 50k more than it would have this time last year, which is how long he and his wife have been looking for. Brisbane sounds like it's moving alright.

 

[menty]

Am I missing something here? I would have thought that an NRAS apartment is very poor for capital growth, especially in the first ten years.

That was more for a tax advantage situation . NRAS properties would still experience the same rate of CG as a non NRAS property no?

 

[spludgey]

That was more for a tax advantage situation . NRAS properties would still experience the same rate of CG as a non NRAS property no?

There still appears to be an NRAS premium on properties, so you'd have a bit of a deficit that you'd have to catch up on.
On top of that, it's a unit as opposed to a house, so the capital gains will probably be less over the long run.

 

[dbun]

NRAS properties would still experience the same rate of CG as a non NRAS property no?

That is my understanding too. I mean, at the end of 10 years, you are just left with a standard house/unit. So there is no reason why it wouldn't have the same CG as a similar house/unit in the area.

The only thing, as mentioned above, is being wary of paying a premium for a NRAS property.

If you get one close to market median, then you are probably off to a good start.

 

[Aaron Sice]

That is my understanding too. I mean, at the end of 10 years, you are just left with a standard house/unit. So there is no reason why it wouldn't have the same CG as a similar house/unit in the area.

The only thing, as mentioned above, is being wary of paying a premium for a NRAS property.

If you get one close to market median, then you are probably off to a good start.

except youve pocketed $100-odd a week for over 10 years and now there s no NRAS youve used that extra to pay down the mortgage and have 10 years worth of rent and capital growth against a severely reduced mortgage.