Lakemba???? thoughts on here or similar

[Shuttergirl]

A fellow SS suggested Lakemba as somewhere to maybe take a look at. Since I know nothing of Sydney at all I would welcome your thoughts.

This is what I think I know, hahaha:-

Close to the CBD
Huge ethnic community
Rough-ish
Not much capital growth over the past 5-10 years
2br Units $175-$200k
Rents $230-$285 p/w

Husband is just completely uncomfortable with the idea. I'm not so sure and would welcome your thoughts. So close to the CBD, surely at some point there would be a regentrification of the area. Good landlords insurance and a kick @$$ PM would be a given.

Could this be a good investment.

And if you think I should run screaming to the hills away from this idea, could you suggest some other suburbs to be looking at.

We could actually spend up to probably $350k, maybe at a stretch $400k if the yield was okay.

I guess on paper Lakemba looks alright but if there is no growth and the area is just far too rough then it doesn't look that good in the end. I would really appreciate hearing your thoughts.

 

[depreciator]

Yep, Lakemba would look good on paper.
Can't comment on the prices, growth prospects etc because I don't know.
Yep, parts of it are rough. Bit of a 70s unit ghetto in many places.
To Sydney people, it's not at all close to the CBD. It might look close on a map because Sydney is so spread out.
Having been there a few times - in daylight - I think gentrification may be a forlorn hope.
There are units (if that's what you want) in your price range closer in. If I was looking for a unit $350-400 I'd look at the 1920s flats in Summer Hill. Small blocks, good size rooms etc. The ones I like are the ones surrounded by houses.
Scott

 

[ok180]

avoid like the plague.

 

[Jacque]

Hi Shuttergirl

Not an area I'd invest in (and I know it well having relatives living there) but I think you need to see it and judge for yourself.
I believe you could do better with your budget in a no. of other Sydney suburbs- both units and housing. It really depends on where you want to buy and what you're comfortable with. Don't forget, too, that just buying close the Sydney CBD isn't always going to provide you with the best growth over time. Indeed, some of the middle and outer ring suburbs have grown just as well (and in some cases outperformed) inner ring suburbs, so you need to look at the other basic fundamentals when considering "where" to buy. Look up some statistics and you'll soon see what I mean.

 

[Ajax]

Hi Shuttergirl,

I think you would find some similarities with tenants in Auburn and Lakemba (I have a unit in Auburn-rents $250/week probably worth $200k). You also need to factor in strata levies/council rates/property management fees which will reduce the attractiveness of the yield.

Was told when I bought that tenants would be fine 85% of the time. This has proved correct...be prepared to spend time in the Consumer Trader and Tenancy Tribunal about 15% of the time. Landlord insurance is a must as is a diligent property manager.

Depreciator,

Are you referring to something like this (I like it although would be better if had 2 bedrooms)

http://www.realestate.com.au/cgi-bi...r=&cc=&c=31502987&s=nsw&snf=ras&tm=1219910682

1 bedder top floor in Summer Hill asking $335k. Good land content when there are only 4 units.


Ajax

 

[Shuttergirl]

hahahaha, I am running from this idea quickly. Thanks so much for the input everyone. Really appreciate the feedback.

I clearly need to get ahead of some data and do some more research. I don't need to do anything just yet, sometime in the next 2-5 months would be okay. Thought I needed to narrow down some suburbs and watch them for a while.

Lakemba is out.

How about:-

Arncliffe, Rockdale, Tempe

or

Stanmore, Five Dock

maybe something on the Northern Beaches?

I'm not sure where to start frankly so if anyone has 4-6 suburb suggestions then I am all ears. Just want to narrow down my research field.

Where do you think there could be some good CG in the future?

 

[Shuttergirl]

There are units (if that's what you want) in your price range closer in. If I was looking for a unit $350-400 I'd look at the 1920s flats in Summer Hill. Small blocks, good size rooms etc. The ones I like are the ones surrounded by houses.
Scott

Depreciator,

Are you referring to something like this (I like it although would be better if had 2 bedrooms)

http://www.realestate.com.au/cgi-bi...r=&cc=&c=31502987&s=nsw&snf=ras&tm=1219910682

1 bedder top floor in Summer Hill asking $335k. Good land content when there are only 4 units.


Ajax[/QUOTE]

That's a beautiful unit, definitely would prefer 2br though and looking at the rental yields in Summer Hill it would cost us an awful lot to hold a property like this. Very nice property though.

 

[Nathan]

Where is it again? LEBKEMBA?

 

[BV]

Shuttergirl

A better options could be something in the Liverpool CBD near Westfield's or even Bankstown CBD near the CENTRO shopping centre and you will never run out of tenants.

Units in both suburbs have gone down significantly mainly suffering from loan defaults while rents have gone up. Something up to 10 years old, yielding over 5-6% and walking distance from the 2 shopping centres could be a good buy.

Ofcourse in order to have higher yields and to get a better tenants you need to buy in one of the better blocks or to have it updated and kept clean.
This rule applies to all areas anyway, respectable tenants aren't going to live in a run down place.

In regards to capital gains, as Jacque said, outer suburbs can also be very good buys.
I believe though that properties in general have already increased a lot in relation to wages and as we are in a low inflation environment, our wages won't be increasing very fast and therefore our affordability won't improve overnight.

So if you buy something don't expect instant capital gains and a boom in the next 6 months because that won't happen. Over time though, I have no doubt that property prices will go up.

In the mean time, low holding costs are important so I'd concentrate on good yielding properties and as soon as interest rates come down your holding costs will be even lower and your IP's will cost you nothing to hold.

Time and inflation will do the rest.

cheers

 

[Nathan]

Hey BV i was very suprised last night i did a search... since 2004 these units in areas have gone up... i have agent access to a website with sales info... i did a search for units in each ocal suburb and u could pick up stuff for $110-120k in 2004...



there ok areas, just know your risks...

 

[Peter 14.7]

I know one very savvy investor on SS who continually picks the ugly ducklings. This is guy who buys where he recommends, not recommends where he would buy.

He’s latest focus is Lakemba Units.

He ignores stigmas and works on fundamental of growth, infrastructure, demand, return and has had massive success (50% = CG per annum) in Qld buying again the unwanted suburbs before the rest of the market catches up.

I bought two in his last recomendation of Melton VIC and seen them go up 15% in rent and CG in twelve months.

FYI Peter 14.7

 

[Peter 14.7]

How about:-

Arncliffe, Rockdale, Tempe

or

Stanmore, Five Dock

maybe something on the Northern Beaches?

Where do you think there could be some good CG in the future?

Dont know your budget but Chippendale 2008

This http://www.realestate.com.au/cgi-bi...t=&header=&cc=&c=31435406&s=nsw&tm=1219972348
sold for $316k in June and rents are asking $360 to $380 week. Even the carspaces get $40 a week on the black market.

and

when http://www.smh.com.au/news/national...site-masterplan/2008/04/08/1207420389596.html this comes on line then entire suburb will move up five notches.

We saw it boom in Paddington, I lived it in Surry Hills, Chippendale is next then Redfern.
Where else can you be 2km form teh CBD and all the ifrastructure in being built for you?!?!

Peter



Peter

 

[RedPanda]

I would say the Parramatta is going to become a economic hub in the future times, it already is but I think it will grow. So anywhere between Parramatta and Sydney would be a good area to invest. I personally think that if you get a townhouse or a unit in Parramatta CBD, it would be an investment where rentals return is going to increase and vacancies very low. I have seen 20-25 people coming in open houses. You should be able to get something decent between 250000-350000. In Parramatta go for a 2 bedder as the demographic profile is dominated by small families.

 

[tess85]

lakemba has a shocking reputation in sydney, not close to the CBD at all.

Parramatta might be worth a look, as it is its own "CBD" (although obviously much smaller that Sydney's CBD!) just don't go too far west of there.

 

[depreciator]

Depreciator,

Are you referring to something like this (I like it although would be better if had 2 bedrooms)

http://www.realestate.com.au/cgi-bin...&tm=1219910682

1 bedder top floor in Summer Hill asking $335k. Good land content when there are only 4 units.

Yep. I like those old flats. Often the buildings are in great condition and sometimes they are surrounded by houses.

I like the inner west for future prospects, but who knows. I do think proximity to rail transport will become increasingly important.

I'm with Peter re: Chippo, too.

Scott

 

[Shuttergirl]

Okay I've just come from my mortgage broker and I definitely have up to 400k to spend. He agrees this next property is crucial to my portfolios growth as I am running out of equity.

I've got my PPOR and a 3br IP in Melton which will be a slow burner I guess. So this next IP needs to get me some good equity so that I can move forward in a year or maybe 2 into another IP.

That said, he feels that maybe a house in the west would be a good idea and so I might concentrate my searches around there. Could you make any suggestions as to where I should be looking with my 400k budget in mind? Once I have a search area down I can then spend some time really getting to know the market before making a decision that I feel is crucial for the future of our portfolio. My strategy is definitely buy and hold over the long term but I need some more equity to keep buying.

Any tips would be great. And do you think this idea of looking for a house in the west is a good one?

Peter and Scott, I'm off to have a look at RE.com at Chippendale. Thanks

 

[tess85]

My 2 cents: check out any areas near the unis, eg. Camperdown/Chippendale (University of Sydney) Kensington/Kingsford (University of NSW), and maybe the ones near UWS (University of Western Syd)

 

[depreciator]

Slow down, Shuttergirl. The Sydney market isn't going anywhere - except down in a few places. Your mortgage broker may indeed be taking a keen interest in the structure of your portfolio. Or he might just be really keen to write a loan. He's probably not going to disagree with you. I certainly think you might be a bit bullish expecting to be able to pull equity out in 12 months or so.
As for suburbs out west, others will have some specific suggestions. But why not start by looking at areas within half a klm of train stations on the western line?

 

[tess85]

cityrail's website might be a good place to start

http://www.cityrail.info/

the uni of western sydney has several campuses, all in the west area, most are close to train stations too
http://www.uws.edu.au/campuses_structure/cas/campuses

 

[stumunro]

in terms of gentrification of crappy areas, nothing has more potential then top ryde / meadowbank / west ryde units and houses. Surrounded by nice suburbs massive shopping centres and improving public transport, it is an absolute no brainer.