I'm GLAD I bought OTP in Melbourne

So I bought OTP in Coburg at Air Pentridge about six weeks ago. The ave price for a 2BR in Coburg seemed to be around $420-$440K and I paid $530K. What I hear you ask? Yes I KNOW it's above the median and OMG it's in a hi-rise what was I thinking?

Well... it DID have an amazing view of the city from one side and the Dandenongs from the other. No pool or gym either so body corp lower than normal hi-rise apartments. Also unique in that it's in the Pentridge development which has a special place in my heart.

Even the guy selling tried to persuade me to buy 2 x 1BR instead because I'd get a better rental return but we stuck with the 2BR because the 1BR didn't have city views, which is what made it so awesome in our eyes.

Also, if other investors are buying the 1BR all the more reason to buy a 2BR so I'm not competing so hard for a tenant right?

Anyway... since then I've been really busy trying to buy a more normal established, small block 2BR in inner Melbourne and I'm constantly priced out of it at auction AND in private sale. I lost out on one yesterday that was only advertised as 'for sale by owner' with one OFI because someone else was willing to pay $60K above market price.

I feel better and better about our earlier decision every day and every time we miss out on yet another unit.

Our OTP doesn't settle until Feb 2012 by which point the median will probably have caught up at the rate we're going AND we have the advantage of an amazing view from the 8th floor. (or at least my perspective tenants do)

I'm giving up on Melbourne and turning my attention to Sydney and Brisbane. Melbourne is going to have to wait until next time round.

I love you Melbourne, you're my home and I'm really glad my PPOR/IP is in the obscenely overpriced Richmond but goodbye and good luck. All the crazy people willing to pay $200K above reserve can have it.

Rant over. Feel better. Thanks for listening :p

P.S. Yes I know I can find probably find property further out in the 20k ring etc but that doesn't suit my personal strategy.
 
Anyway... since then I've been really busy trying to buy a more normal established, small block 2BR in inner Melbourne and I'm constantly priced out of it at auction AND in private sale. I lost out on one yesterday that was only advertised as 'for sale by owner' with one OFI because someone else was willing to pay $60K above market price.


Now imagine if you had bought an established place from day one!!! :eek:
 
Now imagine if you had bought an established place from day one!!! :eek:

OTP suited my personal needs better. My first in Richmond (mix PPOR/IP - long story) was OTP as well and worked out just fine. When completed the bank valued it at $50K more than I paid, and I bought it late into the project (completed 4 months after purchase) so it's worked out just fine for me so far. Valued again last week for $200K more again two years later so I'm happy with that.

So long as it's got something more unique than the usual run of the mill crap, I don't think there's anything wrong with OTP.

This 2BR 3 year old one sold last week for $480K.
http://www.realestate.com.au/106261231 After stamp duty if an IP, it's costing $505K. Not that far removed from the $532K including stamp duty that I paid. Except we get the full 5 year depreciation benefit and that rather special view.
 
*snip*
Our OTP doesn't settle until Feb 2012 by which point the median will probably have caught up at the rate we're going AND we have the advantage of an amazing view from the 8th floor. (or at least my perspective tenants do)
*snip*

The second part of your statement may well be likely. The fact that your strategy, such as it is, relies on the first is not a good sign in my experience.

FWIW
 
Hi RedCat

Yes, Pentridge has a special meaning for me, too

I worked in Newlands Road,Coburg for five years and lived in a unit on Bell Street for two of those years

Pentridge was still a working prison in those days, I used to see the Guards up in the watch towers while I was taking the turn across the bridge

The bluestone walls have such a solid feel. I remember many things about the Prison - the fire among many other events - and the splendid Gates on the west wall.

I hope you do very well with your purchase. You have bought a small piece of Melbourne's history. My younger Son has bought into the redevelopment of one of the red brick Fire Stations, those handsome buildings dotted around the Depression Ring - the same architect as who designed the Essendon Fire Station

Buying off the plan has an air of excitement about it, my lad is just thrilled to have the opportunity to be part of a heritage redevelopment.

Good luck with the bluestone and the views of the city. No doubt your tenants will also be thrilled to have the opportunity to live there

Cheers
Kristine
 
Thanks Kristine. The history / heritage aspect had a HUGE amount to do with it. I visited Pentridge when it was a working prison - unfortunately to see my brother :( There's a weird feeling of justice at being able to buy there now that I can't quite explain in words.
 
The second part of your statement may well be likely. The fact that your strategy, such as it is, relies on the first is not a good sign in my experience.

FWIW

Sorry - I'm missing something. Relies on the first statement? Not sure what you're referring to.
 
I think Tf is saying that the fact that you're relying on the market to catch up to your purchase price means that you have not bought well.
 
I think Tf is saying that the fact that you're relying on the market to catch up to your purchase price means that you have not bought well.

It definitely bothered me that it was over the median (and I knew this at the time) but what premium do you put on a view?
 
It definitely bothered me that it was over the median (and I knew this at the time) but what premium do you put on a view?

This reminded me of a show I watched couple months ago where a couple had bought an appartment in sydney with multi-million dollar view and paid lots of money for it. A few months after, development started for a highrise appartment just in front of their building. Ouch.

I'm not saying it'll happen to you. I just wouldn't pay big $$$ because of a view.

hope it goes well :)
 
Why on earth anyone would want to buy in a place that has been inhabited by murders and rapers AND had murders and rappings on that very soil....no thanks...
 
We paid $40K under the asking price (which was overpriced anyway) but I don't feel we paid big $$ for a view. We paid a premium yes but not big $$. Considering there's new development directly in front already, there's very little chance of ever losing the view from the 8th floor.

As for it's history. Well yes, some people couldn't think of anything worse than being associated with a prison. And other people (like me) would pay a premium for that as well. That's what I love about it. Each to their own
 
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