OTP in Toowong?

Hi all,

I'm looking at an OTP boutique development in Toowong with very low number of apartments in the block. The location is extremely convenient being walking distance to almost everything. The apartments are of decent size (min 100m2 including balc) and some have river view (the ones I'm interested in). Finishes seem to be of high quality with timber flooring in lounge and stone kitchen etc. Body corp rates are reasonable due to lack of facilities. Pricing is not cheap, however, going well over $550k for 2Bed 2Bath 1Car. Pricing per square meter is approximately $5500+

From the information provided above, does this sound too expensive or does it still have some potential?

Thanks for your attention and any input/suggestion is much appreciated :)

Cheers!
 
Price is in the ball park of what we see regularly and the units seem on the larger size. Price/potential are very specific to the property.
 
Price is in the ball park of what we see regularly and the units seem on the larger size. Price/potential are very specific to the property.

Hi RPI,

Thanks for the input. Pricing of this development is not expensive in comparison to other new and larger developments being spruiked at the moment, however, it commands about $50k premium over established units with similar specs and I'm just wondering whether it is justified... This development is also right on a major road, which is another concern I have.
 
I'd always prefer to buy established in most circumstances. Besides the premium for OTP you'd avoid any potential issues with delay, quality of build (as you can see it at the time you purchase), valuation etc.
 
I'd always prefer to buy established in most circumstances. Besides the premium for OTP you'd avoid any potential issues with delay, quality of build (as you can see it at the time you purchase), valuation etc.

I understand and concur. However, I do believe there are special circumstances that would make OTP a sensible investment eg when you have enough capital for the deposit but have maxed out your borrowing capacity at that very point in time and market condition is ripe for growth: agree/disagree?
 
Another quick question: an apartment on a higher floor with view vs an apartment on a lower floor with a HUGE entertaining balcony but no view, which one wil hold up value better than the other?
 
Another quick question: an apartment on a higher floor with view vs an apartment on a lower floor with a HUGE entertaining balcony but no view, which one wil hold up value better than the other?

I did due diligence on Toowong, St Lucia and Indro last year. I'm guessing you are looking at Sense on the corner of Maryvale and Jephson, which is 7 levels I think. I agree that the apartments are well proportioned compared to 38 High Street and as a result the price per sqm is lower.

Jephson St is busy and the streetscape is pretty ugly. Maryvale is nice with a mixture of low rise townhouses and Queenslanders. On the plus side it is a stone's throw from the shopping centre and transport.

I don't think the lowest apartments are at street level, possibly the equivalent of a third story.

I don't think a view from the N/E to S/W corners will survive future development, but the N/W corner might, check the zoning to see how high a building can go up adjacent on Maryvale.

I personally would not buy a low apartment on the Jephson street side due to street noise. However I'd consider it on the Maryvale side or the S/E corner. There is a hotel just down the road though - not sure how rowdy it gets.

Generally once you get above level 4-6 I don't think the achievable rent increases in line with the cost of the property, thus your yield will slip. However in this development, a top floor N/W apartment with a view to Mt Cootha might offer a bit more differentiation for prospective tenants or future owners.

I didn't end buying in Sense, I chose a St Lucia property as it suited my objectives better. Check out the opportunities around Indro as well. The shopping centre there is massive and seems to be attracting more of the premium brands.

Good luck
CT
 
I understand and concur. However, I do believe there are special circumstances that would make OTP a sensible investment eg when you have enough capital for the deposit but have maxed out your borrowing capacity at that very point in time and market condition is ripe for growth: agree/disagree?

How do you know your borrowing capacity will improve enough by the time of settlement? Seems risky signing a contract on that premise to me.
 
I did due diligence on Toowong, St Lucia and Indro last year. I'm guessing you are looking at Sense on the corner of Maryvale and Jephson, which is 7 levels I think. I agree that the apartments are well proportioned compared to 38 High Street and as a result the price per sqm is lower.

Jephson St is busy and the streetscape is pretty ugly. Maryvale is nice with a mixture of low rise townhouses and Queenslanders. On the plus side it is a stone's throw from the shopping centre and transport.

I don't think the lowest apartments are at street level, possibly the equivalent of a third story.

I don't think a view from the N/E to S/W corners will survive future development, but the N/W corner might, check the zoning to see how high a building can go up adjacent on Maryvale.

I personally would not buy a low apartment on the Jephson street side due to street noise. However I'd consider it on the Maryvale side or the S/E corner. There is a hotel just down the road though - not sure how rowdy it gets.

Generally once you get above level 4-6 I don't think the achievable rent increases in line with the cost of the property, thus your yield will slip. However in this development, a top floor N/W apartment with a view to Mt Cootha might offer a bit more differentiation for prospective tenants or future owners.

I didn't end buying in Sense, I chose a St Lucia property as it suited my objectives better. Check out the opportunities around Indro as well. The shopping centre there is massive and seems to be attracting more of the premium brands.

Good luck
CT

Hi CT,

Thanks for your very information answer. I'm actually not referring to Sense but another smaller boutique development not far away. I've PMed you with some additional info. Hopefully you will be able to provide some further insights. Again thank you for taking the time out to provide a reply :)

Regards,
Brandon
 
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