[Melbourne] Thoughts on apartment as first home/investment?

Discussion in 'Where to Buy' started by 7smurfs, 12th Jan, 2012.

  1. Melbournian

    Melbournian Member

    Joined:
    23rd Apr, 2010
    Messages:
    2,513
    Location:
    VIC
    yes that is what we are seeing - small corrections etc but prices aren't really going back to where they were 5 years ago if that is what you are hoping to achieve. Properties in premium suburbs still sell over 1 million like in brighton.

    There is a problem with the new first home buyers especially when coming into the market taking on huge loans with minimal deposit and high repayments which puts pressures on their daily lives.
     
  2. The Fence

    The Fence Banned

    Joined:
    1st Oct, 2002
    Messages:
    3,843
    Location:
    Bush NSW
    Common folk find it hard to afford lamb or the best cuts of beef these days too. Basic tucker, a very real requirement no...?

    Are we seeing a correction in those things..that's right no.

    Electricity is another...no.
     
  3. Weasil007

    Weasil007 Banned

    Joined:
    13th Mar, 2012
    Messages:
    144
    Location:
    Weasilville...
    http://www.rs.realestate.com.au/cgi-bin/rsearch?a=ars

    Why not use RP Data results at 57.5% ? This is what I mean..different results from different sources on supposedly the same events (auctions). If there is a discrepancy then which source do you use? For such an important indicator I would have thought we have one regulated provider who works on a standard reporting method each week. Take the REIV figure of 1053 auctions with 690 selling and 363 being passed in. Of the 690 sold 99 were sold before even GOING TO AUCTION. But these 99 sales count toward the auction results :confused:
    How can you take an auction result report and effectively judge it on it's merits or compare week to week or month to month when a variable like pre-auction sales is included in the overall result :confused:

    Maybe for this week ? How many are scheduled for this weekend coming?
     
  4. Melbournian

    Melbournian Member

    Joined:
    23rd Apr, 2010
    Messages:
    2,513
    Location:
    VIC
    that's coz advertisements were done on the basis of an auction and possible interested parties might have wanted to try their luck by putting in offer prior to auction and also the vendor might have wanted to keep the costs down by not paying the auction fees. Works both ways.

    Auction reports (VIC) only work on a macro view of the overall market. if you're a investor with portfolio diversified across victoria or managing a property fund that has victorian residential properties where you constantly buying and selling yeah i agree that is some usefulness but if you are in a suburb where you know the streets, prices it has sold for and why it has been sold for there is minimal relevance.

    There are also other variables like high vendor expectations, desperate sellers, the "Mainland chinese buyers", demographics, locality to schools etc. there was a place sold in brighton for 7 million recently but that doesn't mean it can be replicated and could be argued as a once off rather than the prestige of the suburb.

    It's can be said it is also accounting - you can be sure to highlight the positives out the ratios in a company annual report as opposed to the negatives. it is how you interpret the data.
     
  5. Weasil007

    Weasil007 Banned

    Joined:
    13th Mar, 2012
    Messages:
    144
    Location:
    Weasilville...
    Oh... what happens if a property is advertised for sale...doesn't sell, but then gets taken to auction. If the bidder actually first saw it as a For Sale rather than an Auction should it still count as an auction....see what I mean, it's unregulated and the results are hence unreliable..Under your scenario it's ALWAYS counted as an auction, regardless of how it is sold, regardless of how the purchaser even came across the property and regardless of it even went to auction! Don't get me wrong, I couldn't care a toss about auction results, but when people use them as a basis for the health of the market they cannot be used in this manner unless the index basis is the same week after week...
     
  6. Melbournian

    Melbournian Member

    Joined:
    23rd Apr, 2010
    Messages:
    2,513
    Location:
    VIC
    normally it goes from auction to "for sale" not the other way around. I sold my property at auction got passed it and sold after auction with couple of guys waiting around 6 months ago - it was still considered as a sale through auction. that's why they have abbreviations like Passed in, Prior Sale etc

    But yes if you couldn't care about the auction results, why would you care about how people use it as the health of the market. you're all for not buying property anyway. It's all subjective on how you want to see it. Honestly, better to debate on worthwhile property topics rather than something so trivial as a sale prior to auction.
     
  7. BayView

    BayView Member

    Joined:
    2nd Feb, 2007
    Messages:
    12,129
    Media:
    9
    Location:
    Mornington Peninsula
    Exactly right.

    And, the vast majority of auctions are held in the areas where auctions are more successful - misrepresenting the real market.
     
  8. strongy1986

    strongy1986 Member

    Joined:
    23rd Feb, 2012
    Messages:
    954
    Location:
    Beaumaris
    If the common folk of Melbourne are too busy buying doodads and travelling overseas then what are the drivers of the recovery/ next up leg going to be.
    It's fair to say most young people these days don't know how to save money and the idea of owning their own house is an impossibility. This is what most believe.

    This is people between the ages of 22 to 30 I am talking about. They see that it's out of their reach (in most areas) and don't bother to save. To me this would mean less demand, couple that with an ageing population (more supply) and already high house prices compared to incomes I don't see where the growth is coming from.

    Someone please provide a counter argument
     
  9. Weasil007

    Weasil007 Banned

    Joined:
    13th Mar, 2012
    Messages:
    144
    Location:
    Weasilville...
    Affordability is the key. Folk can argue all day long about a shortage of houses, but if the younger folks can't afford to buy them they will live at home longer, rent, share accomodation or squat.
     
  10. Melbournian

    Melbournian Member

    Joined:
    23rd Apr, 2010
    Messages:
    2,513
    Location:
    VIC
    affordability is key i agree and the first places to fall with significant impact would be areas where mortgages are under pressure due to income levels etc such as doveton (foreclosure capital of melbourne).

    But if you're expecting young folks to pump up growth in toorak or brighton, then that is highly unlikely as that is separate micro market by itself. Places like singapore and hong kong have many young folks would can't even afford a place to live which is likely to be same situation here if there is no measures put into place.

    As for apartments - i wouldn't be buying it as investment solely on auction rates etc. As the PM said, australia should cash in on the growth from asia. I know the glen waverley apartments build next to the railway station sold out in hours and had ppl buying offselling them for 30-50K more than what they paid nowadays. The same would apply if the carpark in russell St if it is converted to an apartment block. that would be a rush of buyers. See it how you like it - money talks i suppose
     
  11. DBAHO

    DBAHO Member

    Joined:
    6th Dec, 2012
    Messages:
    1
    Location:
    Melbourne, VIC
    Thought I would add to this thread instead of starting a whole new one.

    I'm also a FHB looking for property ATM, with a very similar sort of budget and preferences to the original poster. Looking for something in the $400K-$500K mark, whether it's an apartment / unit / townhouse etc., mainly in inner Melbourne suburbs such as Brunswick, Fitzroy, Richmond, Collingwood, Abbotsford, Northcote etc.

    So I guess my question is more around what would people recommend in those areas? There's a fair few "Off the Plan" Apartments going up, but reading those various posts on here, it's probably better to look for other "safer" property if you will.

    Properties like these have caught my eye so far;

    http://www.realestate.com.au/property-unit-vic-northcote-111697991

    http://www.realestate.com.au/property-apartment-vic-northcote-110942159

    http://www.realestate.com.au/property-apartment-vic-south+yarra-111129807
     
  12. Deltaberry

    Deltaberry Member

    Joined:
    25th Sep, 2009
    Messages:
    4,893
    Location:
    Melbourne, Victoria
    They rush to buy new ones then can't resell it. One of our staff bought QV few years ago, 2 bedder, for 690. Can't sell it now (obviously).

    We'd develop our sites around Chinatown if possible because as you say, the Chinese just pay a premium for new stuff near Chinatown because, well, they're Chinese. But there's all sorts of height restrictions now and unless your project is very big (>25,000sqm) where you can go straight to Matthew Guy, you have to play by VCAT rules and obviously my good friends at council and deal with rules like setbacks, 40m height restrictions and strange heritage rules such as this ugly building was where the first dog died so therefore, tada, it's heritage.

    Of course, there's no shortage of people investing in strange sites. Not sure why the 29-year old Richard guy spent $40m bucks on that Russell St/Chinatown site which has a 20m height restriction, or the Chinese syndicate that took Metro. The metro guys can't even touch the site now and are desperately trying to find people to sell parcels in the land. Something like 10m height limit at the front and 40m at the back end bit.

    So nothing like sitting on land doing nothing now and see if these dominoes fall and snap them up one day.
     
  13. Jake Milne

    Jake Milne Buyer's Agent (Vic)

    Joined:
    26th Jun, 2012
    Messages:
    1,037
    Location:
    Australia
    Your budget is healthy, there is better.
     
  14. Melbournian

    Melbournian Member

    Joined:
    23rd Apr, 2010
    Messages:
    2,513
    Location:
    VIC
    yeah i know a mainland chinese guy who bought 5 pizza places and 3 milk bars all in the red - similar to a person who bought a vineyard couple years ago.

    if that russell st goes up - i don't mind getting a place there due to the location as it's close to all the eateries and restaurants.
     
  15. Deltaberry

    Deltaberry Member

    Joined:
    25th Sep, 2009
    Messages:
    4,893
    Location:
    Melbourne, Victoria
    Well he won't be building much for a while unless Ted is keen to get out of government or Matthew can't wait to become opposition leader.

    I see he's made front page Age today.
     
  16. Melbournian

    Melbournian Member

    Joined:
    23rd Apr, 2010
    Messages:
    2,513
    Location:
    VIC
    No wonder he's been hanging out in glen waverley a fair bit - his red ferrari with the license plate GU seems to be there all the time.