New Record Price For Frankston?

[annie lumen]

I've heard that there is weakness in parts of the entire Melbourne market.

But this sale shocked me.

http://www.onthehouse.com.au/buy/property/47706275?PageNr=3

The salesman has more than earned his commission by selling a fairly ordinary Frankston house at what seems to be a record price. So much for talk of a weak market.

Is this a potential development site? Anyone know why it sold for such a high price?

Any opportunities for arbitrage? ie. ignoring all the negative news and buying low.....and then reselling at a higher price?

 

[Nick]

How much did it sell for? $440,000?

If so this is nothing to be surprised about - with quality properties in Frankston sell for in excess of $1.5 million. One on the market at the moment for $2-2.2million

This is in the Frankston High School Zone, has a pool, large block (but not sub-dividable) and is on the border of Frankston and the higher valued Frankston South.

Id say anything under $500,000 would have been a good buy.
Frankston is a very large suburb with property selling from $250 to $2.5million

 

[annie lumen]

If a house on a non subdivisible block in Frankston can sell at such a high price during what are very tough times, one would expect a great deal of capital gain for cheaper homes (ie. sub $350,000) in the area once the interest rate environment improves and more first homebuyers move in.

 

[Melbournian]

As indicated above by the poster - anything below 500K it is a good buy. Now i'm just asking quote from a another poster on his sale of property in frankston if this is a once off occurence or is it a general trend in frankston at this point in time?


http://www.somersoft.com/forums/showthread.php?p=773075#post773075

Quote:
Originally Posted by tcocaro View Post
There is a shortage of stock that people can afford. They cannot afford the stock available because of the high asking prices which is a direct result of excess demand over supply which keeps prices up.

We have a 2x1 bedroom unit with SLOG, courtyard, separate toilet, in a quiet court in Central Frankston, near Myers and the train station, near the Monash Freeway entrance, near the hospital and the TAFE.
We need to sell it, and have been told by the agents it is worth $270k.

In 6 weeks of selling campaign; not one offer - not even a low one.
The agent even said DON'T DROP THE PRICE!! because there is no point doing so - the market is pretty flat. He hasn't been able to make a sale this month. In a place like Frankston; this is unheard of.

We would take $250k if the settlement was short.

Now, if this is unaffordable in today's world, I'll go he.
aah! but it's not a brand new 3x2 house with DLUG, within 5km's of the CBD. Damn; that'd be the problem .

 

[Melbournian]

I've heard that there is weakness in parts of the entire Melbourne market.

But this sale shocked me.

http://www.onthehouse.com.au/buy/property/47706275?PageNr=3

The salesman has more than earned his commission by selling a fairly ordinary Frankston house at what seems to be a record price. So much for talk of a weak market.

Is this a potential development site? Anyone know why it sold for such a high price?

Any opportunities for arbitrage? ie. ignoring all the negative news and buying low.....and then reselling at a higher price?

i will tell you the prices on this street sold

Your sale above was listed 15th Oct 2010
8 Wallace avenue, frankston sold 420K (listing price was 439K)
41 Wallace avenue, frankston sold 440K - 3rd Dec 2010
29 Wallace avenue, frankston sold 500K - 12 Aug 2010

I'm just analyzing the figures to see if this suburb is going to be worthwhile to invest in the future as many forum members do invest there. As with my own properties - i would get the floorplans of the entire building to understand how and why the properties were sold and if declines or increases can be attributed to macro or micro factors, demographics or something else.

 

[long88]

it guess it on the school zone, that is why it is valued that high. apart from that, nothing outstanding from it.

I've heard that there is weakness in parts of the entire Melbourne market.

But this sale shocked me.

http://www.onthehouse.com.au/buy/property/47706275?PageNr=3

The salesman has more than earned his commission by selling a fairly ordinary Frankston house at what seems to be a record price. So much for talk of a weak market.

Is this a potential development site? Anyone know why it sold for such a high price?

Any opportunities for arbitrage? ie. ignoring all the negative news and buying low.....and then reselling at a higher price?

 

[annie lumen]

i will tell you the prices on this street sold

Your sale above was listed 15th Oct 2010
8 Wallace avenue, frankston sold 420K (listing price was 439K)
41 Wallace avenue, frankston sold 440K - 3rd Dec 2010
29 Wallace avenue, frankston sold 500K - 12 Aug 2010

I'm just analyzing the figures.

There's a whole heap of old houses in Frankston, on subdivisible blocks, that sell for less than $350,000. Eventually, when the market someday improves, one would expect the lower end to catch-up with the top end.

 

[Melbournian]

How much did it sell for? $440,000?

If so this is nothing to be surprised about - with quality properties in Frankston sell for in excess of $1.5 million. One on the market at the moment for $2-2.2million

This is in the Frankston High School Zone, has a pool, large block (but not sub-dividable) and is on the border of Frankston and the higher valued Frankston South.

Id say anything under $500,000 would have been a good buy.
Frankston is a very large suburb with property selling from $250 to $2.5million

excess of 1.5 milion - 2.5 million? Your post really intrigued me as i haven't heard of it so i had to research this since i have been spending considerable amount of times studying properties that sell within the range you mentioned and developed and programmed my own database of sales of these properties in this range in melbourne. I even developed my own conditional logic in C sharp to see if there is correlation btw various factors like income vs property values vs size vs distance to city vs distance to beach etc.

with a average weekly income of an individual of $606 and a household income of $1076. i took it from bureau of statistics but factored in inflation from 2 years ago. Normally household incomes need to be much higher than that to achieve a consistent $1 milion hit range. Just my analysis.

Out of 2 years to march 2011 - out of 200+ sales, the highest reported sale was 690K which was a dev site of 1358sqm.

 

[feihong]

excess of 1.5 milion - 2.5 million? Your post really intrigued me as i haven't heard of it so i had to research this since i have been spending considerable amount of times studying properties that sell within the range you mentioned and developed and programmed my own database of sales of these properties in this range in melbourne. I even developed my own conditional logic in C sharp to see if there is correlation btw various factors like income vs property values vs size vs distance to city vs distance to beach etc.

Out of 2 years to march 2011 - out of 200+ sales, the highest reported sale was 690K which was a dev site of 1358sqm.

I think what he meant was Olivers Hill, Frankston:

http://en.wikipedia.org/wiki/Olivers_Hill,_Victoria

price in excess of 2million is not abnormal in that specific area of Frankston. Another top-end area of Frankston would be Gould St.

 

[Melbournian]

I think what he meant was Olivers Hill, Frankston:

http://en.wikipedia.org/wiki/Olivers_Hill,_Victoria

price in excess of 2million is not abnormal in that specific area of Frankston. Another top-end area of Frankston would be Gould St.

That area is frankston south. is not abnormal? - highest reported price is 1.3 million. Wouldn't be suprised a clifftop property would sell for that price. I saying every area has penthouses as oppose to normal apartments. Being average properties in comparing apples to apples - haven't found any odinary property in frankston CBD that has done that. It's like albert park vs south melbourne. although just kms apart - the price range is vastly different.

nothing on $2 million in 10 years. Gould st best performance was in 2007. last 2+ years nothing of that sort - normally patterns of consistent performance would at least have a couple of occurences in 3 years as oppose to random performance. Again just analysis of figures to dictate conclusions. no harm intended.

 

[investor2009]

A bit of Frankston news for you all.

I've just placed one on the market purchased for $295,000 1.5yrs ago and the agent tells me it will achieve around $380,000 so that's pretty good!

I did do a bathroom reno that cost $8k though but the rest is just capital gain. It's a nice looking property and the rental return is good with a great long term tenant in place.

 

[annie lumen]

A bit of Frankston news for you all.

I've just placed one on the market purchased for $295,000 1.5yrs ago and the agent tells me it will achieve around $380,000 so that's pretty good!

I did do a bathroom reno that cost $8k though but the rest is just capital gain. It's a nice looking property and the rental return is good with a great long term tenant in place.

That's pretty good. Is it a brick and tile house and is it on a development site? If so, why sell at all - might be worth waiting for a $400,000+ pricetag.

 

[investor2009]

Thanks Annie.

It's about 600sqm so I don't think it's subject to development potential?
It's a brick veneer and tile with the ensuite already reno's when I bought it
and a really discusting one that was horrid so decided to get rid of that.

It's also 4 bedroom very close to St Paul's.

We're only selling because of this: http://www.somersoft.com/forums/showthread.php?t=69979

 

[annie lumen]

I think 4br homes always fetch a premium in Frankston and sell very quickly. You did well buying it so cheaply. The fact that it is over 600sq metres suggests that it is a development site.

 

[investor2009]

Thanks Annie!

I've just looked again and it is 530sqm, I don't know if that would still qualify? built in 1980 with a new kitchen reno and some new tiles plus the bathroom I mentioned earlier done before I bought it. Thanks for your comment about buying it so cheaply but I remember that I paid a bit above asking price at the time and felt as though the agent had pushed me into buying it a little, so I just paid the 'right' price for the time I guess.

The agent did tell me that 4 bedders were the way to go when buying in Frankston, I guess he was right!

 

[Melbournian]

A bit of Frankston news for you all.

I've just placed one on the market purchased for $295,000 1.5yrs ago and the agent tells me it will achieve around $380,000 so that's pretty good!

I did do a bathroom reno that cost $8k though but the rest is just capital gain. It's a nice looking property and the rental return is good with a great long term tenant in place.

Growth like that was achieved nearly everywhere in melbourne if bought 1.5 years ago.

Well - a property is only worth as much as a buyer would be willing to pay.

 

[investor2009]

Yes. Correct

 

[annie lumen]

Thanks for your comment about buying it so cheaply but I remember that I paid a bit above asking price at the time and felt as though the agent had pushed me into buying it a little, so I just paid the 'right' price for the time I guess. The agent did tell me that 4 bedders were the way to go when buying in Frankston, I guess he was right!

I'm searching for cheaper 4 bedders right now but they are few and far between. Might have to buy a cheaper 3 bedroom house and add an extra room later.

Well, I think you've done very well indeed. If it wasn't for the naysayers, I would have got in when you did. Luckily, the cheaper end of Frankston is still cheap enough for me to afford.

 

[investor2009]

Good on you Annie! Kudos added. It's great to see people willing to take action when the market 'appears' to be bad. The greatest investor of all time 'Mr. Buffet's motto was 'be greedy when others are fearful and fearful when others are greedy' The GFC was at it's worst when I bought and we all know what happened next hey.. I don't see Frankston slowing down anytime soon and personally believe it will soldier on like it has with a steady 10% per annum, I would not be selling if I didn't want to for this new deposit and even then, it's STILL hard to say goodbye!

You will do very well investing in Frankston.

 

[annie lumen]

I'm in the market to buy something at the lower end of the Frankston price-range. Its jolly frustrating trying to find something suitable with 4 bedrooms and subdivision potential for under $350,000. Anyone know any reliable buyers agents?