Point Cook, Melbourne

[Deltaberry]

and i'm guessing all from your area will be unaffected

It might be. But for some reason I think it's a bit more resilient (just a bit don't worry) and the people might be a bit more sensible with more buffer.

But I can put it another way. We've seen a few factories close in a matter of a few weeks around this side of Melbourne. Everytime a few hundred people lose their jobs. Forecast unemployment is still at 8.5% on all fronts. While it's easy for say a corporate lawyer to downgrade and find some low paying job on say 60k or so, can the same be said about the folks losing their jobs on the other side?

So where do you think most of the unemployment will come out of? I guess my question is more: blue collar or white collar? North, south, east or west?

I certainly have a view on that. Sure you might not agree. But like most things, everytme there's 2 views one person will be proven wrong. I look forward to seeing the outcome. Of course I'd rather see no one lose their job but reality's reality and the real bargains will come when poor folks default in that area.

 

[BayView]

why anyone would buy in a dumpy Western suburb is beyond me

This is what everyone thought about Williamstown, Oakleigh, Burwood and so on.

You need to look beyond the current situation and into the future; what the Council's plans are, the demographic movements and so on.

 

[natedog]

Have to agree with you there Deltaberry. People who buy in places like Hoppers and Point Cook and western suburbs in general (excluding premier Williamstown and maybe Yarraville to be politically correct) will always be behind the eight ball when it comes to property and social advancement. I would go further and say people who buy new estates are thick and property illiterate but that is not my place to say. What most people need to understand and appreciate is basic human psychology and behaviour. We all want to have the most and live the best and anyone who refutes this is in denial or is a vague attempt to sound less superficial. Personally, if I had my way, I would be living in Toorak sipping on 1830's Marcelo Noir's (don't worry about googling for it because I made it up, got you didn't I?, haha) and invite Jennifer Hawkins over to my place and get her to personally demonstrate how to put one of her 'Lovable' bras. How this relates to property? Well, it 100% relates because why do we all buy property in the first place? Many reasons you may say - roof over our heads, perpetual cashflow, tax deductions, leverage, securitisation, but do not forget about the upgrade factor, and I shall explain the DeeHwa property advancement theory as follows:

1. Buy 1 bedroom flat in whoop whoop
2. Save and leverage to buy 2 bedroom flat in whoop whoop
3. Save and leverage more to buy 2 bedroom unit in whoop (jut one whoop)
4. Save and leverage even more to buy 2 bedroom house in average suburb
5. Save and leverage even more and more to buy 3 bedroom house in average suburb
6. Save and leverage hardcore styles to the max to buy 3 bedroom house in premier suburb

Very simple theory, but one that many people dismiss when they buy in the abovementioned places, especially new estate developments like Point Cook, Sanctuary Lakes, Caroline Springs (can't believe people do not learn from history, you just have to look at the failures of Taylors Lakes, Keilor estates, Sydenham estates...I guess people are just so fixated on the excitement of owning a new home that all else becomes irrelevant - these people obviously have no intention of upgrading themselves but to succumb to the demise of living in a place like Point Cook in perpetuity and then slave their offsprings to be brought up in the same $@#*$#). I am not trying to diss people who buy in new estates development, in fact, I am trying to motivate all these people (regardless of whether they have or have not bought in these areas) to make better and proper decisions in their property investing in the future because if you really want to live in places like Hawthorn, Canterbury, drive Mercedes Benz, have a hot young 20 year old chick as a trophy wife and prance her along Glenferrie Road with your bling bling, then you better put your strap on and invest more wisely! Essentially, you want your properties to grow at a greater rate (% wise) than in your ideal dream location, but do you really think Hoppers and Point Cook would allow you to do that? I think money in the bank would offer greater capital growth than in a place like Point Cook (and there is no capital growth in bank savings so that is how much I think places like Point Cook would grow)

People can go all day arguing about 'oh, but there is a train station to be built in Williams Landing'. My response - I would be fully embarrassed to the max to say I live near such a ridiculous named suburb. 'oh, but there is a great town centre''. My response - sounds more like a retirement village to me than anything. 'oh, but there are great bay views'. My response - I don't care if you can see Jennifer Hawkins (yes, I like Jennifer Hawkins...got a problem?) flashing her panties because I consider all places which is next to cow dung and farm land crap areas of living and investing.

Anyone who thinks places like Point Cook is a wise investment, regardless of whether it is their PPOR or investment property is kidding themselves. As everyone admits, you buy in Point Cook for 2 reasons, namely, it is new and it is affordable. Nothing more, nothing less. As Deltaberry correctly points out, property depreciates and at a greater exponential rate especially with the kind of #$#$&#(*& they use to build new estates. Future home purchasers (who are silly enough to call Point Cook as their ideal home location) will not consider purchasing your house because your house has rotten to the point of beyond recognition and instead, will buy the new estates next door, probably called Point **** or something like that, because they also buy for the same reasons as yourself - new and affordable, so your $E#*$(#hole you are trying to offload would not-surprisingly be un-offloadable (looks like DeeHwa has just invented a new word) or you will be selling at a real loss (by that I mean, growth that is less than the Melbourne trend).

Anyways, I will not continue further because I would be here all night putting forth my position and I don't want to demoralise those who have bought in Point Cook, or intend to (who are probably thinking, thank goodness we have DeeHwa) and I want to go to sleep and dream about love making with Jennifer Hawkins, haha, whilst others are crapping their pants in Point Cook trying to avoid their mortgage defaults, and in the words of Deltaberry, pwnage, ownage beyond GODLIKE!!!

Good Night

Words of Wisdom from DeeHwa

I remember my wifes grandparents telling us they copped the same sort of stick for buying in glen waverley many years ago when it was considered the end of the earth!

This will go on forever probably as Melbourne sprawls, new people want a new house and can afford it on the fringes, which with time are no longer on the fringes and become established....they may lag in capital growth, but they will still grow.

We all aspire to "more" but you have to start somewhere, we cant all afford the $700k price tag to get into a "cough" prestigious area where "cough" EVERYONE wants to live

 

[BayView]

Mate, that is the problem with people on these forums. You have all these people, probably like yourself, who come up with posts about how great Melton is, or Wallan, or Point Cook and then you start to wonder why the people who have bought and sold in Hawthorn, Canterbury, Kew etc. do not come come out raving about their successes. The reason is they are probably too busy counting out the extra $100 bills (they did not anticipate to receive) because their houses have gone up 50% above reserve prices.

To compare these two areas is pointless.

The Kew, Hawthorn Malvern type postcodes are never an "entry level" area for most investors - maybe you doctor or lawyer who thinks he's a financial genius and has the income to enter investing at this pricepoint. They are primarily a cap growth strategy area, which cuts out many mum and dad investors who have limited cashflow.

As an investment area, Kew would be somwhere to either move up to as a PPoR choice, or to buy a period style home with the plans to do a major renovation and resell. This is not the entry level investor or homebuyer who is looking for cap growth

For most folk, the areas like CS or PC etc are good enough on a smaller budget. They may not be the best areas for growth or yield, but you have to start somewhere, and these areas usually keep going steadily up over the years because they end up being closer to the city than the next new area.

meanwhile, the yield is often better, and there is good depreciation (which ultimately is cashflow yield) from these newer dwellings.

 

[Property Meister]

I haven't read most of the previous posts because I don't want to get involved in any disputes/bitterness/aggression

but in my experience, ive found that most of the people who do buy in these new type of estates such as Caroline Springs, are very proud of their purchase, which is fair enough, id be proud of buying a property too, but what I find extremely irritating is that they almost ram it down your throat about how good it is, and say you bought in Hawthorn/Kew, they will fire comments like "oh why would you buy a small older house for double the price when you can buy where we have bought and get better/newer"
or "oh williamstown is 15 minutes drive through traffic but our estate is 14 minutes by jet, so ours is better"

I must find I hear it all the time, and it really annoys the crap out of me, and I feel sorry for the people who receive these comments all the time, its as if they are trying to sell it to you with a real defensive mindest...

has anybody else experienced this?? (Im not saying all people who live there are like this)

 

[Peter Parker]

has anybody else experienced this?? (Im not saying all people who live there are like this)

I have heard it.

But there are just as many spruikers of inner suburbs who claim that outer areas are either all (i) way out in the sticks miles from anywhere or (ii) dominated by fast-food mega shopping malls that are all the same and will never appreciate.

 

[Deltaberry]

Just a tip - try checking the actual sales on all properties in the area, and you will most likely find (read definetely find) that the newspapers highlight the 'star' properties and not all properties in these areas sell for 50% above their reserve prices. Actually many are passed in!

That is quite funny. Your post is a major giveaway that you actually haven't been down to any auctions in these eastern suburbs. I have been looking very closely at Kew, Hawthorn, Balwyn, Richmond Hill etc (among other parts of Melbourne) in the past 4 months, as I was looking to take out a place there.

Funny you should say that many houses are passed in at these auctions and that only the 'star' houses are being quoted in the papers. For almost every auction I've been to in these areas, I've seen them sell for a good 30% over the quoted priced range.

I think your post reflects what the other poster puts most succintly. You've obviously been reading the newspaper and drawing your own conclusions from them without actually going out to see the auctions and verify that what the papers were saying is actually true! So funny you should accuse him/her of not doing his/her own research.

On another note, I can also see the other poster's point about % return and absolute returns. What exactly is confusing you? It's just pointless to keep discussing when the conversation scoops to a stage where we can't even understand that.

natedog, I love the "cough" prestigious area. Perhaps you haven't realised how feudal this country is. But I think you'd find it interesting to go to Melbourne University's Law School and Medical School to see what the demographics are like.

I think the only fair comment is Bayview's; that is, I'd understand if not everyone can afford certain suberbs. But holy, the sour grapes is a bit apparent. And you know, it's all about supply and demand. If enough people disagree with you, you'd have to question the validity of your IP or home because at the very least, your target market has just shrunk by the amount of people who disagree. Simple as that.

 

[jingo]

I think the only fair comment is Bayview's; that is, I'd understand if not everyone can afford certain suberbs. But holy, the sour grapes is a bit apparent. And you know, it's all about supply and demand. If enough people disagree with you, you'd have to question the validity of your IP or home because at the very least, your target market has just shrunk by the amount of people who disagree. Simple as that.

Have a read of these threads. Very informative, well researched and intelligent discussion concerning long term trends in inner, middle and outer suburbs. Also a couple of threads relating to the mini boom in Melbourne in 2007 and reaction of inner northern suburbs during 2008 after/during the share market crash.

http://www.somersoft.com/forums/showthread.php?t=54291

http://www.somersoft.com/forums/showthread.php?t=55966

http://www.somersoft.com/forums/showthread.php?t=42375&highlight=Versus+Outer

http://www.somersoft.com/forums/showthread.php?t=32049

http://www.somersoft.com/forums/showthread.php?t=34809

 

[natedog]

Deltaberry,

I'll admit i was a little sarcastic...but that doesnt change the fact that not everyone aspires to live in the areas DeeWha was banging on about!

As for this pearl of wisdom below....its not quite my experience of the area

Mate, if you bought in Point Cook, you would live next to a bunch of doochbags (i.e. factory workers, blue collar clowns on $10 an hour, problem gamblers etc...) The financially educated will not buy in Point Cook, period!

As far as demographics go, rather than visit Melbourne Uni, i suggest DeeWha go and see what type of people are visiting the local shops on a Saturday morning in Point Cook and see whats going on in the "real world".

Cheers

 

[DeeHwa]

Have a read of these threads. Very informative, well researched and intelligent discussion concerning long term trends in inner, middle and outer suburbs. Also a couple of threads relating to the mini boom in Melbourne in 2007 and reaction of inner northern suburbs during 2008 after/during the share market crash.

http://www.somersoft.com/forums/showthread.php?t=54291

http://www.somersoft.com/forums/showthread.php?t=55966

http://www.somersoft.com/forums/showthread.php?t=42375&highlight=Versus+Outer

http://www.somersoft.com/forums/showthread.php?t=32049

http://www.somersoft.com/forums/showthread.php?t=34809

Jingo, what exactly are you trying to justify and prove by simply cutting and pasting threads on SS??? It seems like you just cannot be bothered forming a logical rebuttal (or perhaps you find it difficult and most likely impossible to form one). Deltaberry has attended auctions in those eastern suburbs and taken notice of the prices that are fetched. That is what I call primary evidence and you can go and quote and multi-quote all you like, but fact is fact and I would rely on that any day.

 

[hercules500bc]

Deehwa

Deehwa,
Let it be known that I am an executive who in fact lives in the West, namely Altona Meadows. Yes I do have a McMansion and my children and wife are safe and at ease here. I have also purchased land at Point Cook to ensure my child has a parcel of land to which to build on in the future with a minimal mortgage.

As a fellow professor of mine once said "It is the literate who fail to recognise the fine ageing of wine who in turn are unable to manifest their thoughts into ones future"

Tally Ho my friend

 

[DeeHwa]

Deehwa,
Let it be known that I am an executive who in fact lives in the West, namely Altona Meadows. Yes I do have a McMansion and my children and wife are safe and at ease here.

As a fellow professor of mine once said "It is the literate who fail to recognise the fine ageing of wine who in turn are unable to manifest their thoughts into ones future"

Tally Ho my friend

Do you know 450sqm land only value in Hawthorn recently fetched $1.275mil (check 3 Ardene Court Hawthorn - initial quote circa $900K) and 419sqm land only value again in Hawthorn fetched $1.411mil (check 29 Connell St Hawthorn - initial quote $1mil+).


Like every other pro-Point Cooker, it seems the only argument you guys have is denigration and abuse. Where are the facts and substantiation? And then Mr Hercules, you go and quote from a fellow professor...so what is your point? How does that make Point Cook a better suburb??? How does that invalidate my comments any one bit? Obviously you have lost the plot.

 

[turk]

Do you know 450sqm land only value in Hawthorn recently fetched $1.275mil (check 3 Ardene Court Hawthorn - initial quote circa $900K) and 419sqm land only value again in Hawthorn fetched $1.411mil (check 29 Connell St Hawthorn - initial quote $1mil+).


Like every other pro-Point Cooker, it seems the only argument you guys have is denigration and abuse. Where are the facts and substantiation? And then Mr Hercules, you go and quote from a fellow professor...so what is your point? How does that make Point Cook a better suburb??? How does that invalidate my comments any one bit? Obviously you have lost the plot.

Hi DeeHwa

Using your facts and substantiation we have established that 2 properties
in Hawthorn sold for more than an agents initial quote, I'm absolutely
gobsmacked at that, who would ever have thought.

Without even offering such in depth analysis I would suggest that land per square metre is dearer in Hawthorn than Point Cook.

Perhaps some where along the line with such analytical research you will also
show readers how a $1 invested in Hawthorn returns so much more than a $1
invested in Point Cook?

Cheers

Pete

 

[DeeHwa]

I am all for analysing any area objectively Deltaberry....i have watched Point Cook grow over the last 7 years, since having first bought land there...and land values have continued to climb over that period steadily, it definitely hasnt performed better than some prestigous eastern suburbs...but for a first home buyer 7 years ago (me), aspiring to own dirt and build...the price was just to good for the proximity to the city for me to pass on...and it has turned out better than i expected...slow boring 150% increase in land value.

i am happy with enough with my own experience having invested in the area, and it gave me the ability to leverage off and invest again.

We started out with me on a $20k taxable income and the missus first year teacher on $38k...so i guess DeeWha would have refferred to us as the doochbags next door

After reading what you said and the attempted sense of humour, I shall not refer to you as a douchebag ever again! Probably hard for you to believe, but you sound like the type of person who I want to do well in their lives and prosper. At least you admit several important points - buying to your limits and what you can afford and your aspiration to upgrade and improve oneself by leveraging off and investing again (hopefully one day to live in the Eastern suburbs on a decent patch of land if that is what you desire) is much to be admired. Good luck with everything!

 

[DeeHwa]

Hi DeeHwa

Using your facts and substantiation we have established that 2 properties
in Hawthorn sold for more than an agents initial quote, I'm absolutely
gobsmacked at that, who would ever have thought.

Without even offering such in depth analysis I would suggest that land per square metre is dearer in Hawthorn than Point Cook.

Perhaps some where along the line with such analytical research you will also
show readers how a $1 invested in Hawthorn returns so much more than a $1
invested in Point Cook?

Cheers

Pete

Excellent observation. Btw, you do realise that a chunk of my post was removed by the Y-Man (and so was Hercule's post as well). I didn't even know you could do that, but oh wells...what a waste of some quality discussion.

anyways, I was trying to show the importance of absolute returns over % returns

 

[turk]

Excellent observation. Btw, you do realise that a chunk of my post was removed by the Y-Man (and so was Hercule's post as well). I didn't even know you could do that, but oh wells...what a waste of some quality discussion.

anyways, I was trying to show the importance of absolute returns over % returns

Hi DeeHwa

I'm glad that you thought it to be an excellent observation, but most posters
on this site would consider it a pretty basic observation.

Looking forward to your numbers setting out the importance of absolute returns over % returns.

Still also awaiting the facts and substantiation to support your argument that investments in Hawthorn returns so much more than investments in Point Cook, to quote you, these are what counts.

In Anticipation

Pete

 

[traveller]

DeeHwa,

I am not a fan of Point Cook by any stretch of imagination but i will take this discussion as a general reference to Outer vs Inner suburbs category.

Few points i will like to make:
1- You categorization of the type of people in these outer suburbs is incorrect. I will say most of them are working families trying to make their futures by working hard. I choose to live in outer suburbs(NE Melb) because i dont see any value in buying a dump in prestigious suburb and paying A$1.5M for it. Although i can afford it but i just dont see value in it e.g buying a 3 bed weatherboard house in camberwell for >1M. I can rather buy a much better house in a reasonable location. I am not saying people buying in Eastern suburbs are not doing well rather that for some people it just doesnt suit their lifestyle and i know for fact that is the case for majority of immigrant families and they are the ones who are driver of the bouyant property market. 6 out of 10 loans that i write are from immigrant families.

2- Secondly i will also argue against your assertion that Expensive suburbs make better investment then Outer suburbs. I have block of land that has increased 4 times in value in past 7 years, so i am talking from experience and not just based on any newspaper article. I have made this case elsewhere before as well so wouldnt go into detail now. I think its well covered in the threads mentioned by Jingo.

My 2 cents.

Thanks- Daman.

 

[DeeHwa]

Hi DeeHwa

I'm glad that you thought it to be an excellent observation, but most posters
on this site would consider it a pretty basic observation.

Looking forward to your numbers setting out the importance of absolute returns over % returns.

Still also awaiting the facts and substantiation to support your argument that investments in Hawthorn returns so much more than investments in Point Cook, to quote you, these are what counts.

In Anticipation

Pete

It is called sarcasm my friend.

Btw, you should read Natedog's comments (who lives in Point Cook) who clearly admits that Point Cook has not performed as well as the prestigious suburbs.

As to facts, well 29 Connell St Hawthorn (my previous example) was purchased for $1.1mil approx. in late 2007 by a developer. It was sold a couple of weeks ago for $1.411mil at auction. I am sure there are many other examples as you would agree, given that you make yourself out as an avid property genius. Surely you would have heard the numerous stories about how Toorak houses were purchased for $4mil and then flipped back to the market for $5mil in just over 12 months.

Oh...don't forget one of the 'sales of the year' in Urquhart St Hawthorn (can't remember the number) but it was sometime in July this year and the agent was Kay & Burton. The vendor Tim Bamford (former Grand Prix chief) expected his house to sell for $1.4mil, maybe $1.5mil on a good day and it went for $2.11mil. I attended the auction, so you would expect the figures are correct (you can go and check, or dig up the article if you may). Now, can places like Point Cook receive such astronomical upside???

Now, using Natedog's example of her land increasing 150% in 7 years (in Point Cook of course). Well, with a fair degree of approximation, lets say the land was purchased for about $200K (random figure I plucked), so now it is worth $500K (which is actually a bit absurd for Point Cook, but lets assume for arguments sake). That is $300K in 7 years but at Connell St, the developer has effectively made $311K in just under 2 years. Excluding transaction costs for clarity, you tell me which one is the more superior investment??? Sure, the financing costs are greater for Connell St, Hawthorn, but you are only holding it for less than 2 years (also indirectly means you pay that much less on maintenance, rates etc.)

I won't even go and talk about value adding potential, because it is an absolute no brainer which place has the better value adding potential.

 

[DeeHwa]

DeeHwa,

I am not a fan of Point Cook by any stretch of imagination but i will take this discussion as a general reference to Outer vs Inner suburbs category.

Few points i will like to make:
1- You categorization of the type of people in these outer suburbs is incorrect. I will say most of them are working families trying to make their futures by working hard. I choose to live in outer suburbs(NE Melb) because i dont see any value in buying a dump in prestigious suburb and paying A$1.5M for it. Although i can afford it but i just dont see value in it e.g buying a 3 bed weatherboard house in camberwell for >1M. I can rather buy a much better house in a reasonable location. I am not saying people buying in Eastern suburbs are not doing well rather that for some people it just doesnt suit their lifestyle and i know for fact that is the case for majority of immigrant families and they are the ones who are driver of the bouyant property market. 6 out of 10 loans that i write are from immigrant families.

2- Secondly i also argue that Expensive suburbs make better investment then Outer suburbs. I have block of land that has increased 4 times in value in past 7 years, so i am talking from experience and not just based on any newspaper article. I have made this case elsewhere before as well so wouldnt go into detail now. I think its well covered in the threads mentioned by Jingo.

My 2 cents.

Thanks- Daman.

Point 1 - working families who work hard generally have low incomes, and hence why they buy in less affluent and affordable places like Point Cook. Can you care to explain further exactly what I said to make you feel my categorisation is indeed incorrect? Don't tell me you are going to use my example of 'problem gamblers' and '$10 per hour blue collar clowns' because you should have got the humour by now. Well, value is in the eye of the beholder. As long as there are 2 competing people yearning for that so called 'dump' you mentioned, then there is value. As for the drivers of the property market, we would be here all day discussing that so I shall refrain from venturing there. I have to admit I am not a loans manager or work in that field, so I will take your word for it. However, I would add mainland Chinese buyers are driving the prestigious Eastern suburbs market, and I am sure the agents on Stonnington and Boroondara are not disagreeing there. Locals are just finding it hard to compete, including myself and it is frustrating (and I am Chinese myself, hahaha, but obviously not as wealthy as the mainlanders who land bank anything they can find.

Point 2- you should re-read what you wrote, because it seems like you are supporting my viewpoint, which is a bit odd. Anyways, care to enlighten us with the suburb or area you bought which has increased 400% in 7 years?

 

[traveller]

I have corrected the point 2 so it should be clear now.

As for the evidence of my assertion - check out the prices of blocks in Sallybrook Circuit, Narre Warren when it sold in 2002-03 as also the last sale value and you will get the proof...

I put my stress on the individual deal rather then the suburb or location and this strategy has rewarded me well over the years...