Kings park / kings Langley / B.hills / Cherrybrook

[Raj61]

Hi,

If budget was not a constraint, which of the above areas would be THE preferred choice, purely from % return point if view.

Time frame say 5 years

Which would be easier to rent out

C.G is the primary aim

Cash flow is not a problem and negative gearing helps me in my current position.

I am not looking to build a portfolio of 10 properties over 10 years, mainly as I think it's beyond me to manage that, hence besides this I might just end up with one more say a unit close to the city at a later stage.

My estimate on current pricing -

KP - 450 to 500k
KL - 600 to 650 k
BH - 650 to 700k
CB - 700 to 750k

I'm finding it quite hard to decide, So do appreciate any and all inputs.
This is my first IP.

Thanks

 

[Propertunity]

I'm finding it quite hard to decide, So do appreciate any and all inputs. This is my first IP.

It is actually easy to decide IF you have the data

See attached chart comparing all 4 suburbs over the last 20 years. The bars are volume of sales, the lines are the moving median prices.

So this is what happened over the last 20 years to now. What no-one can tell you is what happens from now to the next 20 years. .....and if they say they can......run away, fast.

 

[Jacque]

Hi,

If budget was not a constraint, which of the above areas would be THE preferred choice, purely from % return point if view.

Time frame say 5 years

Which would be easier to rent out

C.G is the primary aim

Cash flow is not a problem and negative gearing helps me in my current position.

I am not looking to build a portfolio of 10 properties over 10 years, mainly as I think it's beyond me to manage that, hence besides this I might just end up with one more say a unit close to the city at a later stage.

My estimate on current pricing -

KP - 450 to 500k
KL - 600 to 650 k
BH - 650 to 700k
CB - 700 to 750k

I'm finding it quite hard to decide, So do appreciate any and all inputs.
This is my first IP.

Thanks

Hmm seeing as I've bought in all these suburbs several times over let me have a go CB and BH particularly hot right now, due to ongoing demand, affordabilty, infrastructure changes to the area and solid rental yields. KL and KP further out (and both in Blacktown LGA as compared to Hills and Hornsby LGAs) but cheaper, more affordable for a wider range of buyers and also with solid rental yields. It ideally comes down to which street you're buying in, what the condition of the property is like, what potential it has (if any) to extend, add a g/flat dual occ, rental yield and demand, proximity to amenities etc. It's not as simple as selecting one of the above suburbs.

Engage in a few weekends of opens at each suburb, collate information from agents, property managers, fellow investors etc and then come back to us. Happy inspecting

 

[devank]

See attached chart comparing all 4 suburbs over the last 20 years. The bars are volume of sales, the lines are the moving median prices.

Graph shows that they all seem to behave similarly! It looks like the percentage growth is similar.

This is what I would do (a bit geeky way) in this case.

Step 1: Model each suburb based on other suburbs median and may be few other factors such as interest rate, consumer confidence, median price of whole LGA etc
Step 2: Predict what median each suburb should be at now.
Step 3: Choose the suburb which is under valued.
Isn’t that easy to do?

If price & Cash flow is not a problem then I would choose CB or BH (close to good schools) where you can build a duplex in 20 years time and also where you can build a granny flat right now. I will do that if I win a lottery

 

[Propertunity]

Step 1: Model each suburb based on other suburbs median and may be few other factors such as interest rate, consumer confidence, median price of whole LGA etc
Step 2: Predict what median each suburb should be at now.
Step 3: Choose the suburb which is under valued.
Isn’t that easy to do?

I'd insert Step 4: Hire Jacque Parker as my BA who can get me a good deal

 

[devank]

I'd insert Step 4: Hire Jacque Parker as my BA who can get me a good deal

Isn't that the 'default' step?

 

[Raj61]

Morning guys,

Thanks for all your inputs, much appreciated.

Taking it a bit further - I am at North rocks, been in the area around 10 years, so reasonably familiar with north rocks, carlingford and a bit if Epping.
Having lived here this long, I am acutely aware of issues coming out of not having a train station close by.

Have friends in BH and I only hear that the transport situation they face is only worse, and CB seems to be no better, what with new line road, boundary road and castle hill road being chockers during office hours and pennant hills road no better.

I know about the northwest rail, and the impact it's likely to have down the track, but unless you are between 0 - say 1.5k of the station, the real benefits may not be so huge, and for CB you already have Pennant hills station which maybe servicing some parts of CB.

So is this current heat in BH and CB a bit of hype you reckon, or is there some real change coming up.

I know CB tech is a preferred high school what abt primary school, which one is considered the best.

For BH which is the preferred side, is it what lies off old Northern road or off Windsor road.

A lot of the arguments I've given above is more to get your take on what I might consider issues.

Devank, could you give some more details on how to put ths model together, I'll only be able to do something using excel, not quite sure how to proceed.

Jacque, thanks heaps for yr inputs, I will do my dd on both CB and Bh and come back with what help I need from you.

Cheers

Raj

 

[devank]

Devank, could you give some more details on how to put ths model together, I'll only be able to do something using excel, not quite sure how to proceed.

It is basically matter of finding a mathematical relationship between what you are interested in and all other relevant factors. Having said that, I do econometrics panel modelling for living
If you are not even familiar with correlations & regressions then I wouldn’t suggest you doing it. However, I’m happy to do a simple modelling if you can collect all datasets (time series of relevant factors).

 

[caneye]

(1st post here!)

You also have to take into account the fact that CB is a much younger suburb than BH. CB is what .. ~25 yrs old?
Houses in BH are ~40 yrs old.

We bought a place in BH over 10 years ago. I must say that the appreciation has been somewhat disappointing when compared to the other Hills suburbs (like WPH & CB). I am perplexed and can't really put my finger on it. For the price we paid for a house in BH, we could have bought a duplex in CB. After 10 yrs, a quick (non-scientific) comparison tells me that the value of the duplex is now much higher than the BH house.

Depending on where you live in BH, the transport situation is not as bad as what some commuters claim. The BH place was within walking distance to the M2 corridor. Before the M2 upgrade started, one could take the Hills bus direct to Wynyard door-to-door within 45 minutes. To me - that's a reasonable commute time for a suburb of this distance.

 

[western_sydney]

There's many houses in CB older than 25 years.

 

[Raj61]

I guess one reason for the difference in growth would be that whilst BH is your regular working class, middle of the middle income suburbs, whilst CB gets a bit more upmarket, more aspirational, and of course the block sizes, age of buildings etc.

Over the last 12 months or so the gain you have seen in CB could be linked to the NW rail and the impact it is likely to have. BH will benefit too, but maybe people think CB will more so.

Then you have the schools aspect, BH has a few, but around CB you have all the private senior schools as well.

I have somehow always carried the impression that Castle hill road and new line and boundary roads are a mess during peak hours, maybe I need to go see for myself how bad they are, maybe they are not quite as bad as I have assumed.

Does anyone use these roads for travel to the city, and how are they really?.

The M2 bus is certainly an asset if you live close to a stop, but there's only that many who use the bus, a think a much larger number do rely on cars, and whilst a parent might go to the city on the bus, kids, ESP in senior schools will need other modes and that's where BH and CB both suffer.

Regards

 

[nhg]

I grew up in CB.

There were 4 people in my family, we had 4 cars. Neighbours had 3 people, they had 3 cars. See a pattern?

You can get to the city using the bus, however it stops at Townhall. I went to UTS so I was better off driving as close to PH station as I could and then making the long trek to the station itself (never any close carparks). Driving all the way to the city was a nightmare.

Thing with the proposed station is it is on the other side of Cherrybrook from the school. It would be just as easy to go to the CB station as it would be to go to PH station. So no real advantage.

In saying that, there is a sense of belonging in the area, some sort of prestige that you don't seem to get in BH. It was a lot stronger a few years ago, doesn't have the 'upmarket' feel it had 10 years ago. I loved growing up there (lived in Blacktown LGA before that, you can really feel the difference).

Perhaps it was the association with Hornsby LGA that made it seem better? And the school was phenomenal, tho I believe new regulation means CTHS can no longer hand pick their teachers like they use to, they have to take from a pool just like everybody else.

 

[Jacque]

In saying that, there is a sense of belonging in the area, some sort of prestige that you don't seem to get in BH...

I usually let comments like this go but can't help it this time.... this makes me smile I mean really?!! Having grown up and lived in the northern districts and Hills, and worked in them extensively, I have to disagree with the whole "prestige" tag for CB... maybe when CB was being developed (much like newer Kellyville vs Castle Hill) it seemed newer, shinier and more appealing but that time has passed IMHO There's just as many unkempt homes in CB now than there would be in neighbouring suburbs. As for "prestige" well I guess we'll leave that to a difference of opinion Yes, it's a lovely suburb with lots of families, good schools and access to shopping (unless you want to find parking in CB village on Saturday ) but so is BH. Each to their own...

 

[nhg]

I usually let comments like this go but can't help it this time.... this makes me smile I mean really?!! Having grown up and lived in the northern districts and Hills, and worked in them extensively, I have to disagree with the whole "prestige" tag for CB... maybe when CB was being developed (much like newer Kellyville vs Castle Hill) it seemed newer, shinier and more appealing but that time has passed IMHO There's just as many unkempt homes in CB now than there would be in neighbouring suburbs. As for "prestige" well I guess we'll leave that to a difference of opinion Yes, it's a lovely suburb with lots of families, good schools and access to shopping (unless you want to find parking in CB village on Saturday ) but so is BH. Each to their own...

Haha, agreed.

If you keep reading my comment you will note I said it isn't there anymore.

As the years went by, more folk from the outer west (such as myself) moved into the area, and the original crowd moved out towards Mosman, etc.

CB has terrible transportation, and granted the school is great, though it is more a self fullfilling prophecy as people who want their kids to do well want them to go to a good school, so you end up with a school mostly filled with kids whose parents are encouraging them to study their asses off

 

[nhg]

Should mention. As an investor, I'm personally more inclined to BH.

CB has poor rental returns, and land tax would be a *****.

Actually just convinced my parents to sell out while the market is hot.

 

[Raj61]

I guess Prestige may not be the right word, CB certainly has a more upmarket feel than BH, newer houses, wider streets, because its hilly a lot of houses are 2 or even 3 levels - great to look at from outside, but believe me a pain to manage.

Actually for look and feel etc, I find kings langley way better than BH. It doesnt have the schools, but in many other aspects - community feel, village shopping, seven hills station, living in KL would be just as comfortable, or maybe even better.

Excuse my ignorance, what's the issue with black town council, I mean what's so great abt bhsc or Hornsby council, woud be gd to get a few pointers from you guys.

 

[DennisLeung]

It is actually easy to decide IF you have the data

See attached chart comparing all 4 suburbs over the last 20 years. The bars are volume of sales, the lines are the moving median prices.

So this is what happened over the last 20 years to now. What no-one can tell you is what happens from now to the next 20 years. .....and if they say they can......run away, fast.

Can I ask Propertunity, where do you get that graph data in your post?

 

[Jacque]

Can I ask Propertunity, where do you get that graph data in your post?

Like the rest of us in the BA industry he pays for an annual subscription - these ones are from PDS but there's also RPData and APM.

 

[Jacque]

Should mention. As an investor, I'm personally more inclined to BH.

CB has poor rental returns, and land tax would be a *****.

Actually just convinced my parents to sell out while the market is hot.

Hey nhg don't forget to let me know first especially if it's a property under $700K- have buyers in CB and surrounds right now. Just email me (on website details www.housesearchaustralia.com.au)

 

[nhg]

Hey nhg don't forget to let me know first especially if it's a property under $700K- have buyers in CB and surrounds right now. Just email me (on website details www.housesearchaustralia.com.au)

Haha, hadn't thought about it, will do!

Though I think it is closer to the $900k mark (just a guesstimate).