melbourne CBD or close to.
- Thread starter stargazer
- Start date
Interesting comments. That was definitely the case a few years ago. Not sure if it is still valid though.
I have an apartment in Melbourne CBD and I have seen its value rise by about 20% over the last 18 months. A lot of owner-occupier demand, which drives up prices.
A few years ago, there was a lot of stock coming into the market. Now it seems that there is much less, at least in the CBD. I'm not sure how many more building sites are available to develop but it looks like it is quite a different market that what it was a few years ago.
Cheers,
So Y-man I suppose the suburb you bought those two properties in is an inner suburb as I think 1bed proeperty receives no demand in middle/outer suburbs?
BTW, I am most impressed by your...determination in testing a theory this way
Regards
Vince
The 2 are in Prahran.
My next planned experiment is to buy a similar value property (to the 2BR apartmet) in the outer suburbs (should therefore get a bigger block) and see how they perform against each other....
Cheers,
The Y-man
I'm not that familiar with the workings of these type of investments, however there is no photo, nor mention of the attributes of the bedroom.
Do we presume from this that it is open plan and part of the sitting area, i.e: similar to a motel room. If so, wouldn't that affect cap growth if it is removed from the management rights pool and stands alone as an place for an OO or IP, like the other providers such as Quest et al. Also wouldn't that affect securing finance?
I stand to be corrected if it is a seperate one BR with sitting/meals. In that instance it has a strong yield and obviously a great location.
Finance will be affectd from day 1 due to zoning and use. This will most likely be seen as a commercial property - which it is. I suspect yield and CG therefore should be compared with commercial properties of the same floorspace in the vicinity (i.e. offices).
End of lease to Sebel could mean a dramatic drop in value (similar to a end of lease vacancy in a commercial)
Cheers,
The Y-man
Normaly studios are marketed as studios and this is marketed as a one bedroom, but who knows, I have not checked it out. I have stayed in this hotel in a one bedroom apartment on a higher floor which is probably similar to this place (maybe the same one) and it was quite nice.
Even if it is a studio, there is still a demand for this type of place but yes probably less than a 1BR. Some banks dont like studios and others are fine with them as long as the size is right.
I guess it comes down to whoever is interested, checking it out. I havn't, It just jumped out while browsing re.com.au
My wife keeps telling me how great it would be to have a place in the cbd so we could have nights out in town and stay there. But on doing the math, it's far cheaper just staying in a hotel. If we did get a place, it would probably be one like this.
Docklands perhaps, but certainly not Southbank or the CBD. Docklands tends to be very windy, as you are right on the water.
The past couple of years has seen many supermarkets come to town (Safeway at QV and Coles at Southern Cross Station). The city is full of people now on the weekends where once it used to be empty due to many people now choosing to live in the CBD. We live in Southbank and are looking to purchase in the CBD as we love the convenience of the location and all the amenities. We've previously lived in Collins Street (near the Elizabeth Street corner) and loved it.
Make sure you check zoning on anything CBD as many are mixed use (due to being converted offices/warehouses etc). Look for Capital City zoning.
Franklin Street is on the North edge of the CBD, near the Vic Market, not located in the middle, but still well located. It depends what you are looking for.
Wendy
How is this different to Res Zone 1?
A bit of a pain to get loans for.... or more accurately LVR over 60%.... I think gets treated similar to commercial.
Cheers,
The Y-man
Hi Buzz,
This is just a "quirk" of CBD property I think. I have yet to come across anything zoned Res 1 but you never know. Most have a commercial origin and so the zoning reflects this.
As an example, Concept Blue on Latrobe Street, which used to be the Russell Street Police Station, has been redeveloped into hundreds of apartments. But the zoning is still Mixed Use. Now, you would not have expected hundreds of residents to take out commercial loans to live in their apartments so I guess there is some leeway with the banks to observe the actual use of the property and lend accordingly.
But at the end of the day, they can say it is a commercial lend and the LVR will be affected.
Just something to always check.
Wendy
