Inner City Melbourne - North Melbourne

[Invest1]

I am an investor looking for an investment property in the inner city. Over the past 4 months the prices of houses, especially the single terrace houses in Richmond and Abbotsford are continually rising to the prices that they were achieving in late 2007. I have been speaking to many agents and buyers advocates and they all say that there is one inner city suburb that is at the start of its boom and is undergoing a gentrification that the other inner city suburbs have experienced in the past. They all say North Melbourne. There is a lot of potential for good rent as there are 3 major hospitals on its doorstep and there is major development and Inrastructure planned. I drove around North Melbourne recently and was surprised at the great wide open leafy streets in areas like Erskine, Brougham and Dryburgh Streets. What are your thoughts?

 

[myty22]

I've been watching Nth Melb and West Melb over the last couple of years, waiting for it to really take off. Its always had very good growth but still hasn't reached the heights of other inner city suburbs. If you pick your pocket right you can get some really good returns. I had a unit for a couple of years.

There's a particular section of West Melb that I like, between Spencer St and the railway lines. It's about a 1 minute walk from North Melb station (which they are in the process of doing a major redevelopment), 5 minutes to Docklands Stadium, and 15 minutes walk to the City. There's not alot of through traffic. There's a few small houses but the units, more so the ones that are a couple of years old, seem to have good potential.

 

[jingo]

I am an investor looking for an investment property in the inner city. Over the past 4 months the prices of houses, especially the single terrace houses in Richmond and Abbotsford are continually rising to the prices that they were achieving in late 2007. I have been speaking to many agents and buyers advocates and they all say that there is one inner city suburb that is at the start of its boom and is undergoing a gentrification that the other inner city suburbs have experienced in the past. They all say North Melbourne. There is a lot of potential for good rent as there are 3 major hospitals on its doorstep and there is major development and Inrastructure planned. I drove around North Melbourne recently and was surprised at the great wide open leafy streets in areas like Erskine, Brougham and Dryburgh Streets. What are your thoughts?

Hi,

I was interested to read that agents and buyer's agents say that North Melbourne is currently undergoing a gentrification that other inner city suburbs (eg Richmond) have experienced in the past.

I have gradually been accumulating property in North Melbourne since 2001. I like it's proximity to the CBD, Melbourne University, University High School (Select Government School) Royal Children's Hospital, Royal Melbourne Hospital, Frances Perry etc. A tram line runs down Abbotsford Street, and passes through Errol Street (the main street) into the city. It is also possible to catch a tram on Flemington road which will go into the city via Elizabeth street. A walk into the city from North Melbourne would take between 10-20 minutes. The Victoria Market is located in Nth Melbourne as well.

The suburb has a community feel, and is tightly held by owner occupiers. Owner occupiers usually start off in a flat, then upgrade to a town house or single fronted terrace, and then upgrade again to a double story terrace, double fronted terrace or larger townhouse. They often stay in the area for many, many years.

I personally like the area and wouldn't be surprised to see it continue to grow in value in the years ahead. The streets you describe above (Erskine, Brougham and Dryburgh Streets) are part of an area known as Hotham Hill. That is a good area, (and favoured by some buyer's agents) as the streetscape is attractive and is filled with Terraces, Town Houses, and small blocks of flats. I'd stay clear of Melrose Street which has the large commission buildings. Other areas that have benefited from the gentrification process include streets surrounding Errol Street (the main street) such as Leveson Street and Arden Street. (Arden Street is a main road).

As the area is so close to the city, major hospitals and Melbourne University it attracts a diverse range of people looking for accommodation. They include students, doctors, nurses, and professionals.

Regards Jason.

 

[bunjiBing]

That was a great summary jingo. Thanks for that.

I would also mention proximity to Noth Melb train station, citylink, docklands stadium and the no.55 tram route which takes you to the zoo (or you could walk there I guess).

Me and wife have 1 IP, and I occasionally look to see what's going on in Nth Melb, as well as West Melb.

What are the price ranges at the moment across the different types of props there: flats, townhouse, SF, terrace?

-bB

 

[jingo]

That was a great summary jingo. Thanks for that.

I would also mention proximity to Noth Melb train station, citylink, docklands stadium and the no.55 tram route which takes you to the zoo (or you could walk there I guess).

Me and wife have 1 IP, and I occasionally look to see what's going on in Nth Melb, as well as West Melb.

What are the price ranges at the moment across the different types of props there: flats, townhouse, SF, terrace?

-bB

Hi bunjiBing,

The price ranges for the different types of properties are approximtely as follows:

1) 2 Bedroom Flats in complexes dating around the 60's - 70's range from $330,000 to around $410,000 or so. The higher priced flats would usually include carparking (ie carport) and be on the top floor of the apartment block.

Lower priced flats could be on the ground floor, and may not include car parking.

2) Town Houses - These come in many different styles ranging from those built in the 70's and 80's to those built today. Accordingly, prices vary depending on size and condition. Starting price for a 2 bedroom, double story town house would be around the $500,000 mark or so and moving upwards according to age and quality of fittings, car parking facilities, etc.

3) Single Fronted Terraces range in price from mid $400,000 for a property in an inferior location (eg Melrose Street) up to around mid to high $600,000 for a property in a superior location. (Eg Erskine, Canning, Drybourgh Streets in Hotham Hill). Double fronted and Double story terraces range from approximately $800,000 upwards. Again, quality of fittings, land size, condition, streetscape, parking facilities, etc influence the price of the property.

These are very rough guides and not to be taken literally!

Hope this helps.

Regards Jason.

 

[Nemo]

off the plan?

Hey guys/gals

just reading through this forum and yeah North Melbourne is very interesting. I have been looking at buying off the plan in north melbourne and surrounds.

I've been looking to buy an apartment off the plan in inner melbourne to get FHOG. I'm finding north melbourne is cheaper than the east (abbotsford/carlton and south (southyarra).

What do you think of off the plan in north melbourne??

Nimesh

 

[Invest1]

Thanks for your great comments. I have decided to purchase a property before the prices escalate. I have been to several auctions over the past few weeks and it appears that all of the agents are saying the same things that you have already indicated. I think that I will need to act sooner, rather than later or prices wiull be out of my reach. Is anybody able to advise what the rental situation is in North Melbourne?

 

[VCDenton]

Hey guys/gals

just reading through this forum and yeah North Melbourne is very interesting. I have been looking at buying off the plan in north melbourne and surrounds.

I've been looking to buy an apartment off the plan in inner melbourne to get FHOG. I'm finding north melbourne is cheaper than the east (abbotsford/carlton and south (southyarra).

What do you think of off the plan in north melbourne??

Nimesh

Hi Nemo

Just did a quick google

http://www.smilemortgages.com.au/FHOG.html

First Home Owners Grant Update – 15/05/2009

Q: Off-the-plan purchase - am I entitled to the FHOG?

A: Yes, as long as you enter into the contract of sale by 30/6/2009 and the completion date is before 31/12/2010.

Not sure whether its 100% true though may be the forum brokers can help?

 

[jingo]

Thanks for your great comments. I have decided to purchase a property before the prices escalate. I have been to several auctions over the past few weeks and it appears that all of the agents are saying the same things that you have already indicated. I think that I will need to act sooner, rather than later or prices wiull be out of my reach. Is anybody able to advise what the rental situation is in North Melbourne?

Hi Invest 1,

The best time of the year to be renting out properties in inner Melbourne is the peak rental season which falls between late January and March. Naturally it is still possible to rent properties in inner Melbourne at other times of the year, you just may need to wait longer for a suitable tenant. (Perhaps up to 6 wks). Keep in mind too that many renters have become first home buyers and have left the rental market to move into their nearly acquired homes.

As for approximate rental prices - I can give you a very rough guide:

1) 2 bedroom flats with car parking - range from $330 - $380 per week, depending on condition, location and demand for these properties.

2) 2 bedroom terrace houses rent for between $380-$420 - again depending on condition, size, location, carparking and demand.

3) Town Houses range from around $400 upwards. Again depending on quality, size, parking facilities, location etc.

I am not sure what the exact rental vacancy rate is for Nth Melb at the moment. Some reputable agents who service the area include Woodards in Carlton North and Nelson Alexander, also in Carlton North. I try to have the lease for my IP's in North Melbourne expire around January or early February. That way I find it easier to negotiate rental increases, and also ensure that I have a tenant throughout the 'leaner' months of the year.

I would not allow a local agent in North Melbourne to manage my properties, although having said that, Simpsons (North Melbourne) are great to buy through as they often let properties go easily, sometimes significantly below market value. I would never sell through them though!

Regards Jason.

 

[jingo]

Thanks for your great comments. I have decided to purchase a property before the prices escalate.

Just wanted to add that prices have already escalated significantly in North Melbourne (as they have throughout Melbourne) since 2001. They moved again substantially in 2007. I personally can't see prices moving forward again significantly until the economy improves. I'd take my time looking around to see what you can find. Work out which areas and types of properties are in the most demand. Go to auctions and see what the demand is like. I think you have plenty of time to find a suitable investment. Don't rush into a purchase!

Here are a couple of old threads that may be of interest which document the rise in prices in Nth Melbourne and other suburbs during 2007.

http://www.somersoft.com/forums/showthread.php?t=32049

http://www.somersoft.com/forums/showthread.php?t=34809

Regards Jason.

 

[Invest1]

Hi Jingo,

Thanks for the tip. I have spoken to some of the agents in North Melbourne and get the same feeling as you do. It would appear that the more professional dedicated agents are in and around the Carlton area. I was thinking of purchasing a single storey 2 bedroom terrace residence with a land size of approx 140m2 in the Dryburgh Street area as the streets and the proximity to the trams, trains, parks and the hospitals are excellent. What sort of figure would you expect a house of this type would sell for?

 

[jingo]

Hi Jingo,

Thanks for the tip. I have spoken to some of the agents in North Melbourne and get the same feeling as you do. It would appear that the more professional dedicated agents are in and around the Carlton area. I was thinking of purchasing a single storey 2 bedroom terrace residence with a land size of approx 140m2 in the Dryburgh Street area as the streets and the proximity to the trams, trains, parks and the hospitals are excellent. What sort of figure would you expect a house of this type would sell for?

Hi Invest1,

Depends which part of Dryburgh Street - the street runs from Hotham Hill in North Melbourne right down to West Melbourne. The section of Dryburgh street in Hotham Hill has a more consistent street scape is more desirable than the part of the street that runs through West Melbourne. Dryburgh Street, Hotham Hill has double story terrace homes which sell for between $800,000 and 1M.

This single story two bedder terrace in Dryburgh sold recently for $582,000 through Thompsons. I suspect it was closer to the West Melbourne part of Dryburg street, but am not 100% sure as the map is not attached!

http://www.realestate.com.au/cgi-bi...r=&cc=&c=92356575&s=vic&snf=ras&tm=1243157457

You could ring an agent such as Nelson Alexander in Carton North, or Hocking Stuart and Thompson's in Carlton. These agencies sell in Nth Melbourne as well. I have found that they will show you lists of recent sales. That could be a good place to find up to date sales information.

Regards Jason.

 

[Invest1]

Hi Jingo,

The 2 bedroom single storey edwardian terrace in Dryburgh that sold for $582K was located at the Flemington or Hotham Hill end of North Melbourne. Apparently there were quite a number of bidders at this auction. Do you think that this was at the cheaper end of what you can expect to buy in this area?

 

[jingo]

Hi Jingo,

The 2 bedroom single storey edwardian terrace in Dryburgh that sold for $582K was located at the Flemington or Hotham Hill end of North Melbourne. Apparently there were quite a number of bidders at this auction. Do you think that this was at the cheaper end of what you can expect to buy in this area?

Hi Invest1,

Without knowing the property my guess is that the floor plan had something to do with the price. Properties with logical floor plans sell well and for around $600,000 or so. I am not sure of the condition of this property either - it looked good on the net, but perhaps there were underlying problems with the property that a build report would reveal?

Having said that, the market may be softer at the moment. That wouldn't be surprising considering the weak economy. I am not actively following the market in North Melbourne at the moment so can't comment precisely on what may be occuring.

Regards Jason.

 

[skylynx]

Is anyone aware of any upcoming new development in North Melbourne, whether apartments or townhouses?

 

[Invest1]

Rental Managers

Hi Jingo,

I have purchased a property in North Melbourne and was wondering if you know the name and company of a great rental manager. Renting at this time of the year is tough and I was after someone that has achieved great results and can find tenants in a tough rental market.

 

[jingo]

Hi Jingo,

I have purchased a property in North Melbourne and was wondering if you know the name and company of a great rental manager. Renting at this time of the year is tough and I was after someone that has achieved great results and can find tenants in a tough rental market.

Hi Invest 1,

Congratulations on your purchase. North Melbourne is a great area, and I am sure your investment will pay off greatly in the long run.

I have my properties managed by Nelson Alexander. Sue Van der Linden is the property manager. She has been with the agency for over 20 years and is fantastic at her job. The agency is located at 414 Rathdowne Street, Carlton North. Phone 9347 4322.

I was with Woodards for many years, but found that they had a very high turn over of property managers, who, didn't know the area, and were unprofessional in their approach. I have in the past used Hocking Stuart, but switched from them for the same reason - young, inexperienced, and to put it as nicely as I can, useless property managers!

Hope this helps.

Regards Jason.

 

[cyan1978]

Reigniting an old thread but am keen to hear about thoughts about Melrose Street. There has been a new development of 2-3 BR townhouses along Mark Street which is in a smilar area and it seems to have sold well. Would this help boost up prices in surrounding areas eventually?? I know the commision housing is there but that can be said for sommision flats in Carlton as well. Just wondering if this little pocket could be undervalued?? Or has its limitation with CG and dodgy tenants at the same time? Thoughts anyone?

 

[Alibaba]

North Melbourne is slowly gentrifying... now the gvt plan to develop more density housing at Arden rd and Mccaulay will focus and stir these areas

to date - there have been more sporadic small projects in converting warehouses to apartments.. nothing major

however - the big apartment projects have been really busy for the northern side of CBD - ie Abeckket st etc...

NM needs more facilities like a trendy boutique cinema (Dendy/Kino etc) and more parking spaces around Eroll st to keep up with this gentrification process

the arrival of good restaurants have been good ie Sosta cucina and Auction Rooms

otherwise North and West Melbourne are ripe for plucking any minute...

 

[Deltaberry]

I think you'll find the only people supporting high density building is the sitting council which will probably be voted out before you could say "cheese"