Land as investment in Melbourne

Hi guys

First time poster, been lurking for a month and a bit and had to join up.

Right, I have a house in the Williams Landing area in the SW part of Melbourne. My house has 4 bedrooms, 2 bath and 2 car garage on 500 sqm approx block of land. Similar houses around me sell for about $450k - $500k (older part of Williams Landing). I have equity of about $250k built up. I dont intend to sell this house for the next 2-3 years.

I do not have enough savings to shell out the deposit to build a house, rent it out for 2-3 years and sell it hopefully before the bubble bursts (yeah I know we've been expecting it for 10 years now). So I'm thinking of buying a block of land in the Truganina area for about $220k ish, sit on it for just under 18 months and sell before the 18 month mark (after which they want you to start building around here). I know buying a house and renting it out is better.

Now I know there's the CGT + the interest + council rates + other bills + maintenance to pay. My question is - is this a good idea? Anyone done this in this area? Prices of land around here have been climbing up like there's no tomorrow (which is why I'm thinking of this).

Please give me some honest and real world advice, I could use some!

Thanks.
 
I would vote against it as there is a plethora of choice in that whole western corridor with many other estates planning to release more and more vacant land in the years ahead...which you will be competing against.

Don't forget stamp duty that you will need to pay and recover if you are trying to sell and profit.

The only new subdivisions where speculation like this "might" be profitable is infill areas like Keysborough, Doncaster, or any other golf course/ redevelopment surrounded by established housing where the supply is very limited.

Having said that it was possible to buy land in Point cook 12 years ago and watch it increase in price every 2 months.....coming from a very low base in comparison to today.
 
Thank you for the prompt reply!

You are right about the oversupply of land in this area, new estates release land just about every week. I'm going to look into Laverton too. Read the thread about how Laverton was about "there" and how Sunshine and its surrounds were already "there" with prices.
 
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