Just bought in Marrickville

[depreciator]

I didn't really want to buy it, but it's around the corner from where we live - can see the roof of the building from our house. I walk past this block a few times a week and I've always admired how well kept it is. I noticed this flat for sale and went and looked it more out of curiosity than anything and thought I would be a dill to not buy it.

- It's the top floor with a leafy outlook on both sides.
- 52sqm.
- Bathroom with a shower and bath.
- Big internal laundry.
- good sized bedroom.
- Little balcony.

No parking, but there is a bus stop 100 metres away and the train station is 400 metres. And within a 200 metre radius are 3 GoGet cars. Lots of youngsters in the inner west aren't bothering to own cars.

There is also a supermarket 100 metres away and lots of cafes, restaurants, bars etc within a few hundred metres.

And it's in the good part of Marrickville - a suburb that really is going nuts right now. It is benefitting from the general Inner West run, but also from it's incredibly accelerated gentrification in the last year or so.

I can squeeze the current tenant up to $380pw, which means it would cost me about $100 a week to hold.

With a new kitchen (that I would put in myself because I like a project), it would get maybe $420.

If I furnished it and rented it short term (probably on Airbnb) I would get close to $500pw and it would be cf+. That's what I'll end up doing next year.

This is the sort of thing young first home buyers should be looking at I reckon. It would be a good starter property - liveable with scope to reno.

http://www.realestate.com.au/property-unit-nsw-marrickville-114710527

Scott

 

[LoneWolf]

Congrats Scottie!!
Good luck on creating CF, sounds like fun

Based on my calculations even 500p/w it would still be considered as slight CF negative, correct me if I am wrong

 

[ritchie77]

Congrats Scott

Just a query when looking - how would you calculate land tax saying using this purchase as an example? I have found it difficult to estimate land values and consequently land tax payable on a purchase.

I have used my own land value from Rates Notice as an example at looking in neighbouring areas but wondering what you use say for example in Marrickville?

 

[depreciator]

Based on my calculations even 500p/w it would still be considered as slight CF negative, correct me if I am wrong

Lots of deductions with short term rentals - including good depreciation in furniture.

I'm not sure about the land tax, Ritchie. It will be pretty incidental for that unit in a block of 18.

 

[sanj]

bloody hell, it shows how much more inner sydney is than inner perth, you could buy a new 1 bedder 3km from the city for that price in perth

 

[Richard Feynman]

I inspected the place a couple of times. A very good buy.

I think $500/week on airbnb would be a cinch with a new kitchen. If you maintain a good level of occupancy.

 

[map]

Congratulations Scott, it is a great block & good buy - although I might be biased here (I own a unit in the same building)!

 

[arungounder]

Congrats

Well done.....Seems to be a good buy. On the money I would say...

 

[depreciator]

It's on the money in this crazy market. I suspect if it had gone to auction, it would have sold for an extra $15K at least.
I haven't spoken to the tenant yet. I'm going overseas for a month just after settlement, so it would suit me for him to stay there. I'm thinking it would be good to do the reno in February or March.

I missed your post, map. You would have bought your place before the craziness. It's a rental?

 

[map]

Hi Scott,

Bought during the last round of craziness (late 2010). It's a rental, 2-bedder with a garage. It's being re-let at the moment for $480/wk, seems to be little interest though- didn't think I was being unreasonable with the price.

 

[Richard Feynman]

Hi Scott,

Bought during the last round of craziness (late 2010). It's a rental, 2-bedder with a garage. It's being re-let at the moment for $480/wk, seems to be little interest though- didn't think I was being unreasonable with the price.

Who's the REA?

Thanks to the frenzy of investor purchases over the last 6-9 months, there's an abundance of choice for 2 bedders in Marrickville right now. Couple of weeks ago I looked and there were, from memory, 70+ 2 bed apartments for rent.

Right now, even under $500/week with a car space there's 19 to choose from.

On the up side, stock seems to be drying up a little.

 

[travelbug]

Nice one. New kitchen with an island or a low built in matching table would look amazing.

Not too expensive either to make a WOW factor.

 

[Jolly123]

Congratulatios Scott, all the best for the new purchase.

I know one block of units that were sold for $2,7M in 2003, at 30 Glen street. I think it has 6x 2BR and 4x 1 BR in one title and not renovated. I'm sure the block has been under strata title and sold individually now. That buyer might earn good profit now with inner city is booming .

 

[depreciator]

Anybody who bought in Marrickville ten years ago has done well. We bought our PPOR in 2002. I think back then it was Marrickville's highest residential sale. It has done well.
Glen Street is full of units, but it's not a bad position. I think there was a whole renovated block near there for sale recently.

 

[ritchie77]

And what baout next 10 years? Further growth or already run its course.... I would say it is inner city with lots happening so should be a reasonably safe choice.

 

[depreciator]

Who knows. The whole inner west is having a run, but it will slow down. Things may slip back a bit from the crazy prices now, but not too much. And then it will run again. That's what has happened in the past, anyway. I've lived in the inner west all my life and owned four PPORs there - traded up each time. I read in the paper on the weekend Earlwood is the suburb that has had the craziest price increase - families priced out of Marrickville.

 

[Richard Feynman]

I read in the paper on the weekend Earlwood is the suburb that has had the craziest price increase - families priced out of Marrickville.

An almost 25% increase on median house prices this year already, if I recall. Massive.

 

[depreciator]

And that recent increase was off a pretty healthy base - Earlwood has not exactly been languishing of late. I told a mate of mine who was looking for a house 4 years ago to buy in Earlwood. He would owe me a beer, I reckon.

 

[Richard Feynman]

I imagine a few folks owe you a beer or two mate