Melbourne - my suburb shortlist

[onion33]

What are the pros and cons? Your thoughts?

This is my shortlist for Melbourne suburbs to invest. It would need to be a townhouse or villa or apartment (not a huge block) as I can't afford a house. I've chosen based on consistent 1, 3 and 5 year growth, weekly household income, vacancy rate and owner occupied rate.

Hoping to make the list smaller.

Budget around 450k

I am a new investor. I do not have a lot of experience.

Preston
Heidelberg heights
Heidelberg west
MacLeod
Watsonia
Greensborough
Montmorency
Carnegie
Parkdale
Mordialloc

 

[oc1]

An old two bedroom unit in Ringwood East and Ringwood would be a better choice than most of the ones on your list. Have you looked at these suburbs too?

 

[Spleena]

Hi Onion33

I'll preface my response by saying I'm new to investing as well and have recently bought 2BR Apartments in Elwood ($450k)& Maidstone. My shortlist would be:

Preston - Closest to city with plenty of amenities. Look at units over flats
Parkdale/Mordy - Long term CG due to beachside appeal and proven performance. Try to get townhouses or units though
Carnegie - won't get much under $450 but again great amenities and proximity to the city.

Don't rule out Elsternwick or Elwood either. They have a very chic feel and will be always sought after.

 

[Lord Shanghai]

I can't afford a house.
Budget around 450k

Yes you can! Trees do not grow into the sky and looking at past 1,2,3 year growth is not a crystal ball for the future.

$450,000 is a lot of money. If you go further south Bayside, to unpopular places, you will almost certainly earn better capital gain than if you chose the suburbs on your list. Additionally, a 5% yield in unpopular areas is more than do-able.

I notice Heidelberg is on your list. Places like Heidelberg were once great value, back in the days where there was a lot of public housing in place. That was the time to buy, not now. You would be better off chasing situations like that of 80s/90s Heidelberg. ie. suburbs undergoing renewal, where you can buy a cheap old brick house on a massive block.

 

[onion33]

I've got Heidelberg Heights and Heidelberg West. They are cheaper suburbs than Heidelberg itself which is more expensive.

I agree that $450k can buy a house further out. My problem would be the larger negative cash flow (because no depreciation benefit) which I may struggle with at 8% interest rates.

 

[Lord Shanghai]

I agree that $450k can buy a house further out. My problem would be the larger negative cash flow (because no depreciation benefit) which I may struggle with at 8% interest rates.

Depreciation is an area the ATO is really tightening-up. In any case, to obtain maximum depreciation benefits, you would need to buy something that is near-new. These are rarely ultra-cheap and may have very limited capital gain.

8% interest rates? If you lock in for the next 5 years - you'd be paying 4.5-5% max.

I've got Heidelberg Heights and Heidelberg West. They are cheaper suburbs than Heidelberg itself which is more expensive. 8% interest rates.

Sigh. Hidelberg (West, East Heights et) were a screaming bargain in the 80s. You could easily pick up a house there for $60-$80,000 right up to 1989, when I last visited.

 

[Deltaberry]

That's a rip off. You would have made more money buying a $200k house in Hawthorn.

 

[strongy1986]

That's a rip off. You would have made more money buying a $200k house in Hawthorn.

An older friend bought in 86(give or take a year)

90k for a Californian on 800sqm, beach rd Black Rock

He said that was a lot of money then though

Anyway he's made 100% on the initial purchase price every year for the last 28 years

 

[antistar]

Budget around 450k

Preston
Heidelberg heights
Heidelberg west
MacLeod
Watsonia
Greensborough
Montmorency
Carnegie
Parkdale
Mordialloc

Buy in Frankston or Seaford. You can still get a decent size undivided block 600smq+ for that money. Definitely look to buy on the beach side of the freeway on the largest block you can find and sit on it. In 10 years time you will be glad you did.

Re: rentals as previous poster mentioned 5% is not uncommon in that area

 

[jingo]

What are the pros and cons? Your thoughts?

This is my shortlist for Melbourne suburbs to invest. It would need to be a townhouse or villa or apartment (not a huge block) as I can't afford a house. I've chosen based on consistent 1, 3 and 5 year growth, weekly household income, vacancy rate and owner occupied rate.

Hoping to make the list smaller.

Budget around 450k

I am a new investor. I do not have a lot of experience.

Preston
Heidelberg heights
Heidelberg west
MacLeod
Watsonia
Greensborough
Montmorency
Carnegie
Parkdale
Mordialloc

Perhaps investigate Preston further. Try to buy along the transport routes (ie near the tram that leads into the city). You may be able to pick up an old house on a decent size block of land. Although I suspect you may need a little more than $450K.

A part of Heidelberg Heights have been rezoned Ivanhoe - (The pocket south of Bell Street bordered by Upper Heidelberg Road and Banksia Street). It could be possible to pick up a 2 bedroom unit in this area before prices move due to the renaming of this section of the suburb. The area is convenient to the hospital, train, Ivanhoe shops and Heidelberg.

Something like this (this one is outside the pocket I described above). http://www.realestate.com.au/property-unit-vic-ivanhoe-117919975

 

[alicudi]

Hi

Out of the list of suburbs you present I recommend you look in Preston because of its proximity to the cbd and then Parkdale and Mordialloc due to their proximity to the beach and beachside location.

But if it were me I would take a close look at Frankston...(but you knew I was going to write that!).

Regards,

alicudi

 

[onion33]

Any reason Seaford or Frankston over the other suburbs closer up the highway (Edithvale, Bonbeach, Chelsea etc).

Thanks.

 

[Lord Shanghai]

Any reason Seaford or Frankston over the other suburbs closer up the highway (Edithvale, Bonbeach, Chelsea etc).

Thanks.

Because these two beachside suburbs are a lot cheaper than the rest. They have been left behind for so long, the only way is up.

 

[Dbz_Vic]

Another vote for Preston because i bought there in October last year, a brand new 3 br townhouse close to bell st. Settled July this year and revalued recently for $65k more than what i paid, and right now using that equity to fund my next purchase. There are many factors though including maybe a bit of luck, perserverance and many late nights looking at properties. Its also dependant on your strategy, the type of property and the market conditions at the time. Its not always about what or where you buy, because as long as you are making money (be it equity or cash), thats all that matters isn't it?

 

[JamesP]

When are these boomers (Napthine guvment) going to competently confirm this project so I can finally go ahead and begin my risk free zionist gentrification of Ringwood East? I'm growing rather anxious with the controvesry on the project, can any armchair boomers help me out here? Is this link going ahead or not? It's obviously not an armchair investment until that road link is confirmed. Advice from armchair investors only pls.

 

[neeko]

When are these boomers (Napthine guvment) going to competently confirm this project so I can finally go ahead and begin my risk free zionist gentrification of Ringwood East? I'm growing rather anxious with the controvesry on the project, can any armchair boomers help me out here? Is this link going ahead or not? It's obviously not an armchair investment until that road link is confirmed. Advice from armchair investors only pls.

I'm no armchair investor but I can tell you from my insiders knowledge it's a goer. That's all you need to know.

 

[onion33]

Are you talking about East-West link?

I thought Labor are going to scrap it if they get voted in. And they are favourites to win the election.

 

[GoingDHfast]

Do we really believe Labor would scrap a multi-billion dollar project that would massively benefit the unions? I agree that it's almost definitely going ahead at this stage... unless the Greens get voted in

 

[onion33]

Tell me more about Ringwood. What's it got going for it?

I've been there once and it was nice. I'm just not familiar with the eastern suburbs. They don't feel close to anything but I know they're popular.

TELL ME MORE! TELL ME MORE!

 

[angel investor]

add malvern east, carnegie!