OTPs at Rhodes

[H2O]

I stopped finding IPs previously for some reasons but I've resumed. I'm looking for some units or apartments for my first IP or PPOR.
There are a lot of OTPs being built in Rhodes. It seems to me that the area would be further developed with community facilities, parks, transport, etc. according to the website of the local council. I reckon the location is quite decent except it was an industrial area and the contaminated Parra. river. It's close to the railway station, shopping centre and business parks; 30 mins to the city by train; Olympic park nearby; relatively safe area. It is also expected that the demand of this type of dwelling would continue to rise over there. All these factors are good. However, it ain't cheap. An 1 bedder + 1 study OTP with a car space could cost over 570k.
My concern is the capital gain. I'm wondering if the demand is so high to digest the vast amount of units. There would be more apartments to be built in Wentworth Pt. as well.
Is it worth to buy OTPs in Rhodes?

Thanks a lot

 

[Shahin_Afarin]

I'm not Nostradamus but you will not get decent CG from an OTP in Rhodes.

The holding cost would also cause havoc on your bottom line.

Why OTP and why Rhodes?

Regards

Shahin

 

[DaveM]

Why OTP and why Rhodes?

Yep.. OTP and Rhodes made my DANGER WILL ROBINSON meter go off the scale.

 

[mumbai]

I believe, even a near new (< 5 yo) apartment in Rhodes at current price is not advisable.
; forget OTP!!

As Shahin mentioned, the holding costs will be a havoc. For an IP, you will not get a good yield and no CG. If you really keen on that area, check the other side, Wentworth point, where the prices are still quite less than Rhodes and once the bridge is constructed, the prices are sure to soar.

Well, those are my views anyway.

 

[Propertunity]

An 1 bedder + 1 study OTP with a car space could cost over 570k.

With all due respect, that's insane.

 

[nhg]

With all due respect, that's insane.

I saw this thread before anyone responded. I didn't know how to tactfully say HELLS NO!

The above responses have given me a little push.
Poor quality finishes, small roads, too many apartments... where do I begin.

If you're still keen on blowing money, wait till Barangaroo starts preselling, you can pick up a 1 bedroom for $1M.

 

[H2O]

I'm not Nostradamus but you will not get decent CG from an OTP in Rhodes.

The holding cost would also cause havoc on your bottom line.

Why OTP and why Rhodes?

Regards

Shahin

One of the reasons is that I can benefit from FHOG and stamp duty concession.
As I said, it is due to the transport, nearby facilities, close to big shopping centre, prospective growing population, etc. in Rhodes. However, what worries me is that it could be oversupplied in the area in future which could seriously jeopardise CG and rental yield.
It seems to me that the expected vast growing population around the area is questionable. That's why I hesitate about that. The price is high indeed.

 

[Shahin_Afarin]

Ahh yes as maxwell smart says "the old FHOG and stamp duty concession trick". Don't be fooled by that. In only works in certain transactions. This is not one of those.

Close to transport? Most places in Sydney are close to transport the question is how long does it take to get to where you work (say CBD)?

Close to shopping centre? Again lots of places are close to major shopping centres.

The question is you have a budget of $570k (which is decent) do you really think buying a 1 bedroom OTP in Rhodes is going to give you the best bang for your buck? Why not go for something that has land content?

Regards

Shahin

 

[ebanster]

there is definitely an OVERSUPPLY there. i went to my friend's unit a couple of months ago and low-rise apartments all over the area with congested streets. there is no long-term planning!

renting is good though... my friend is trying to sell his studio unit using a PA (the price at market value) and it's been in the listing for months now

 

[H2O]

I believe, even a near new (< 5 yo) apartment in Rhodes at current price is not advisable.
; forget OTP!!

As Shahin mentioned, the holding costs will be a havoc. For an IP, you will not get a good yield and no CG. If you really keen on that area, check the other side, Wentworth point, where the prices are still quite less than Rhodes and once the bridge is constructed, the prices are sure to soar.

Well, those are my views anyway.

The bridge wouldn't help much I reckon as it will only allow local buses and pedestrians to use it. Moreover, its completion is still uncertain.

 

[H2O]

Ahh yes as maxwell smart says "the old FHOG and stamp duty concession trick". Don't be fooled by that. In only works in certain transactions. This is not one of those.

Close to transport? Most places in Sydney are close to transport the question is how long does it take to get to where you work (say CBD)?

Close to shopping centre? Again lots of places are close to major shopping centres.

The question is you have a budget of $570k (which is decent) do you really think buying a 1 bedroom OTP in Rhodes is going to give you the best bang for your buck? Why not go for something that has land content?

Regards

Shahin

Western Sydney?

 

[Shahin_Afarin]

Depends completely on your strategy. Western Sydney is an option and I am starting to like the Bankstown area and I think it has already become another Western Sydney in terms of demand. If you strategy is development then go outside of Sydney or talk to one of the BA's on the forum such as Alan.

Regards

Shahin

 

[H2O]

Depends completely on your strategy. Western Sydney is an option and I am starting to like the Bankstown area and I think it has already become another Western Sydney in terms of demand. If you strategy is development then go outside of Sydney or talk to one of the BA's on the forum such as Alan.

Regards

Shahin

Thanks for the advice. If my budget is around $500k, which suburbs do you reckon I should put the money to? CG growth is the top priority. I don't have any preference that whether it is an apartment or a house. I don't mind to get my hand dirty to add value on it .
BTW, which suburbs are undergoing gentrification?

 

[nhg]

Thanks for the advice. If my budget is around $500k, which suburbs do you reckon I should put the money to? CG growth is the top priority. I don't have any preference that whether it is an apartment or a house. I don't mind to get my hand dirty to add value on it .
BTW, which suburbs are undergoing gentrification?

There is something like $10B in infrastructure tenders coming up in Sydney over the next 2 years. Eg. F3 to M2 connection and North-West Rail-Link.

Look into it and have a think who will benefit most from it.

Personally at your budget, a couple of years back I would have said Marrickville. Dont know now, it may still be worthwhile taking a look. It is where all my 'career' mates have moved to, those with a love for coffee and city living..

 

[Shahin_Afarin]

You cannot get any good stock in Marrickville for $500k. If I had $500k I would take it to Bankstown with a buy and hold strategy with the intention of either a) building a Granny or b) building a duplex (whichever gave me more bang for my money). You may need to go to around $550k in that area. Rental market is strong, its relatively close to the city (vs say western sydney) and has good transportation.

Alternatively I would go to Newcastle with a 3-4 unit development strategy. Of course I haven't factored construction costs in the $500k.

That's just what I would go. Plenty of other places too.

Regards

Shahin