Old house near the city or nicer one farther from city

[muppie]

What a dilemma... the houses in brisbane are mostly old, made of timber and high set.... however considering its location being closer to CBD, it would logically have higher CG ?

Compared to houses on the GC that are newer (less than 12 years), brick and nicer.

Which should I go for, considering my budget is between 200 - 350K and I'm after some serious negative gearing

 

[Peter Parker]

What a dilemma... the houses in brisbane are mostly old, made of timber and high set.... however considering its location being closer to CBD, it would logically have higher CG ?

Compared to houses on the GC that are newer (less than 12 years), brick and nicer.

Which should I go for, considering my budget is between 200 - 350K and I'm after some serious negative gearing

Wouldn't 'some serious capital growth' be better?

The older one might have higher maintenance costs, more consistent demand, higher capital growth and maybe renovation/subdivision potential.

The newer one will have a big building depreciation allowance, probably need fewer repairs, so could be cheaper to hold. But it might grow slower and/or more erratically than No 1.

If you're able to service loans on two IPs instead of one then the total growth may be similar for both scenarios. Somers book discusses this topic in some detail.

Peter

 

[The Y-man]

Compared to houses on the GC that are newer (less than 12 years), brick and nicer.

Assuming from the last bit that this is an IP, keep in mind that "nicer" is subjective - some renters may want an old character house near the cbd in preference to a mass production new thing.

Spiderman has already alluded to the fact that you may also have potential to value add to these properties.

My understanding is that highset "Queenslanders" are pretty much the equivalent of "period homes" we have here in Melbourne - ie generally not made that way anymore, and therefore with some degree of scarcity factor.

Cheers,

The Y-man

 

[ok180]

If you want to make gold go for the old!

 

[Sailesh Channan]

An older property in a good suburb such as Hawthorne, Bulimba,Toowong Indooroopilly, Bardon,Clayfield, etc will give you good long term growth.

Look for properties in streets that show signs of redevelopment or renovation activity as you will be able to ride on the coat tail of further gentrification.

One of the downsides of owning older properties is the lower yields and depreciation on builds may not be possible leading to higher holding costs.

The problem with outer suburb properties is that you do not benefit from rejuvenation of the suburb and you also have new land releases which can lead to over supply and a possible downturn.

You now have to weigh up the benefits and make a decision based on your circumstances. Rembember, that in the long term all properties go up in value.