Question about buying a unit for investment in Sydney please?

[gobear]

I have heard that the suburbs of Killara and Lindfield (both for units) are actually good investment to go for becasue it shows the forecast is going strong within the next 3 years showing average of about 45-50% increase for both properties each year whereas other suburbs, average increase is like 10%, 20% etc

Any ideas or suggestions?

Thanks

 

[twobobsworth]

gobear;555485shows the forecast is going strong within the next 3 years showing average of about 45-50% increase

Where can I get one of those crystal balls?

 

[Rob Williams]

Where can I get one of those crystal balls?

I'd like one, too!! It sure would take the risk and guesswork out of this investment caper.

 

[Propertunity]

I have heard that the suburbs of Killara and Lindfield (both for units) are actually good investment to go for becasue it shows the forecast is going strong within the next 3 years showing average of about 45-50% increase for both properties each year

Who is dong the forecast here please?
and then tell him, "he's dreamin'"

whereas other suburbs, average increase is like 10%, 20% etc

Put me down for two of each please

 

[stumunro]

I have heard that the suburbs of Killara and Lindfield (both for units) are actually good investment to go for becasue it shows the forecast is going strong within the next 3 years showing average of about 45-50% increase for both properties each year whereas other suburbs, average increase is like 10%, 20% etc

Any ideas or suggestions?

Thanks

Just be thankful you have found this place!

BTW i think they are a great investment - but it's important you have realistic expectations about property before you dive in head first.

 

[farmilor]

To suggest that the oversupply of units all up and down the Pac Hwy will cause prices to jump from $500K -- $750K --$1.125m -- $1.7m in 3 years is outrageous.

Not sure where you're getting your forecast from but I think they may be a little misleading

Even 10% - 20% in average suburbs would be fantastic in current climate.

Like Stumunro said, make sure you know what you're in for before you rush out and buy here.

What impact do you think the proposed rezoning around most of the train stations / town centres will have on supply/demand and prices in the coming years???

 

[Jacque]

Hmmm... sounds like biased forecasts to me. Considering that both these suburbs have had unit sales of less than 90 in the last year it's pretty easy to base forecasts on too small sample numbers to draw any type of reliable conclusion, and especially when it comes to forecasting future growth.

Nice North Shore suburbs- predominantly housing, with units grouped around the stations (naturally) - I can see a future market in baby boomers downsizing and wanting to stay in the area, that's for sure. But as for 40% growth increase, well... that's a pretty big call.

 

[gobear]

I am quite surprised that many people are stunned by the words I said since most people would realise Killara is a potential area

In case you wondered where I got, I got them from here:

www.investsmart.com.au/property/default.asp?s_cid=domain

If you notice it, the 2 suburbs i.e. Killara and Lindfield are the BEST top performing suburbs by 12 months out of ALL states in Australia (and if you click on the suburb link, it will show you the forecast from 1-3 years).

I have researched all other suburbs using that website. Sure there are other suburbs that increase even more up to 100% growth but in terms of realiabilty within 3 years, indeed, Killara and Lindfield are the most stable condition as estimated

What do you guys think?

 

[Token Funder]

Analysis.....you're doing it wrong.

 

[gobear]

Analysis.....you're doing it wrong.

So....you are implying that they are bad and trying to mislead us giving this such of info?

 

[Rolf Latham]

possibly not implying

ta
rolf

 

[65fbk]

I am quite surprised that many people are stunned by the words I said since most people would realise Killara is a potential area

In case you wondered where I got, I got them from here:

www.investsmart.com.au/property/default.asp?s_cid=domain

If you notice it, the 2 suburbs i.e. Killara and Lindfield are the BEST top performing suburbs by 12 months out of ALL states in Australia (and if you click on the suburb link, it will show you the forecast from 1-3 years).

I have researched all other suburbs using that website. Sure there are other suburbs that increase even more up to 100% growth but in terms of realiabilty within 3 years, indeed, Killara and Lindfield are the most stable condition as estimated

What do you guys think?

I see HISTORY there, but not FORECAST.....

 

[Propertunity]

I see HISTORY there, but not FORECAST.....

65fastback is correct - that is history not a future projection

and Token Funder is correct - you are doing your analysis incorrectly.

You have identified a trend, on face value, but you need to do more research and dig deeper - especially in relation to "median prices".

Can I recommend to you this thread to read?:
http://www.somersoft.com/forums/showthread.php?t=48346

Keep searching & you'll find the keys.

 

[twobobsworth]

Can you give me the address of these units that have gone up 50% in the last 12 months? I would like to have a look.

 

[Ajax]

gobear,

your analysis is not very good.

Houses Units
Median Prices $1,435,000 $787,000
Long-term Trend 7.48% 6.11%
Auction Clearance Rates 83% 62%
Days on Market 60 97
Discounting 8.84% 7.68%

It also says houses fell by 14.0% but units were up 54%.

Killara, NSW 2071 Map
Houses
Median Price $1,435,000
12 Month Price Growth -14.0%
Rental Yield 3.1%
Units
Median Price $787,000
12 Month Price Growth 54.0%
Rental Yield 4.2%


Sometimes median prices can fail to be representative of the market as many new more expensive units sudddenly come onto the market with higher prices (when the building project has been completed). Doesn't necesssarily mean if you owned an average unit here 12 months ago the price of the unit would have gone up 54%.

Something else happens in Northrn Territory where land and house sales are lumped together as houses. When the land becomes built on suddenly the median prices reported jump substantially

i.e. Property Research - Farrar, NT 0830

Farrar, NT 0830 Map
Houses
Median Price $189,000
12 Month Price Growth 105.0%
Rental Yield 6.3%

 

[Jacque]

Stats vary from source to source as well. For example, the latest Residex report states last yrs cg rates for Killara units as 8.84% and Lindfield 8.53%, so I'm not sure where the 54% rates are sourced from.

You also need to remember that cap growth rates are affected artificially by new dvpts in the area, particularly those of a high end nature. For example, Lindfield has some pretty upmarket $1.2m+ units in its new Mirvac builds (see here http://www.realestate.com.au/cgi-bi...r=&cc=&c=71260539&s=nsw&snf=rbs&tm=1244794033 ) which, when compared to the traditionally older units in the area (see here http://www.realestate.com.au/cgi-bi...r=&cc=&c=71260539&s=nsw&snf=rbs&tm=1244794033 ) serve to skew the growth figures somewhat, as you can appreciate. Always undertake further investigation when growth rates appear to be too good to be true, and you'll begin to see for yourself why they may be misleading or deceptive.

Best of luck with your purchase- I quite like these 2 suburbs myself but would only buy units within walking distance of Lindfield or Gordon and Killara stations. With many baby boomers downsizing in the area, yet still wanting to remain close, such Mirvac apartments will have a market, despite their pricey tags. Picking up an older unit in the $500K's and renovating it could well be a good start to one's portfolio if you buy well. Best of luck!

 

[gobear]

Stats vary from source to source as well. For example, the latest Residex report states last yrs cg rates for Killara units as 8.84% and Lindfield 8.53%, so I'm not sure where the 54% rates are sourced from.

You also need to remember that cap growth rates are affected artificially by new dvpts in the area, particularly those of a high end nature. For example, Lindfield has some pretty upmarket $1.2m+ units in its new Mirvac builds (see here http://www.realestate.com.au/cgi-bi...r=&cc=&c=71260539&s=nsw&snf=rbs&tm=1244794033 ) which, when compared to the traditionally older units in the area (see here http://www.realestate.com.au/cgi-bi...r=&cc=&c=71260539&s=nsw&snf=rbs&tm=1244794033 ) serve to skew the growth figures somewhat, as you can appreciate. Always undertake further investigation when growth rates appear to be too good to be true, and you'll begin to see for yourself why they may be misleading or deceptive.

Best of luck with your purchase- I quite like these 2 suburbs myself but would only buy units within walking distance of Lindfield or Gordon and Killara stations. With many baby boomers downsizing in the area, yet still wanting to remain close, such Mirvac apartments will have a market, despite their pricey tags. Picking up an older unit in the $500K's and renovating it could well be a good start to one's portfolio if you buy well. Best of luck!

Yeah, to make it clear, I was focusing on the UNITS and not the expensive units like Mervic nor houses and the price I intend to target is mainly in the 500K's with a bit of renovations involved.

So my question was whether this will be the worth investment within these 2 suburbs?

 

[Jacque]

So my question was whether this will be the worth investment within these 2 suburbs?

Only you can make that decision. And no one here can assure you of any future growth, despite the very best forecasts.

 

[Token Funder]

So....you are implying that they are bad and trying to mislead us giving this such of info?

See above