Sydney Auctions going mental?

M

MightyWill

I went to an Auction in Sydney's inner west on Sat (Strathfield) to bid on a 2 bed that needed a new kitchen, bathroom, carpet and paint. The total reno would cost anyone 30 - 40 mark for a mid range job.

My budget was around the 625 mark with a prediction it would go anywhere from 610k to 635k mark. Brought my friend along as well who lives in the area.

It sold for 680k and if we factor in the reno work of 40k, it really costs 720k for a low rise, 20 year old unit with strata at 700pq. Recent sales in the street and neighbouring streets were around 620k with reno already done to the place.

My prediction was way off and I'm glad I didn't go in thinking I had a real chance or any emotional attachment.

It was however a 144sqm unit, only one bathroom, main bedroom was prob bigger than a double by another metre each way and a lock up garage and carport. The kitchen and bath was prob a sixe you find in a house so that was the selling point.

If we look at say Zetland or even Rhodes, this is prob how much you would pay anyway but it would obviously be a lot newer.

Strathfield is very central to outer west and inner west inc 13 kms to city but the suburb itself does not have much to offer apart from a Woolworths and schools and the obvious express trains to the city.. It looks like it?s being run down from all the rental tenants in the suburb. School don?t really matter for me at this stage for a PPOR.

By the way, it would appear the vendor had a reserve of 700k and it took them about 15 mins over the fone for them to accept the 680k offer. A bit of greed in my opinion.

Here is the property.

http://www.realestate.com.au/property-apartment-nsw-strathfield-116431675

Would you rather buy a house near Kellyville for this price?

I think I have to scratch Strathfield off my list now.

Any opinions?
 
144 sm is big for a two bedder .

I'd say oversupply is more of an issue that strathfield , which as far as aim aware would b considered one of the more up market suburbs in the area if not the best , so the pice doesn't surprise me .

To be honest with out studying that area and unit in greater detail , I would have thought 680 was pretty good value .... for a unit that size in strathfield .

BTW , sydney auctions have been mental since late last year . The question is will they slow down . Some of the commentators are pointing out a slight drop in clearances in the last 1-2 weeks , but considering that last sat , 12th April was the biggest auction day in Sydney's history and they're still quoting around 80 % clearances rate , I'm starting to wonders if it's just going to keep on going .

I would have thought that anyone who was going to sell in the immediate future would have sold by now .

Cliff
 
MightlyWill, i think your predictions are off, however at the same time I think I would not pay more than $550k for that place (from an investment perspective).

As much as I hate this saying, "the market sets price" - it is true and there's nothing you can do about it.

If you're using anything purchased prior to May 2013 as a guide, multiple that by 1.15 - 1.20 to get the range at which it will sell for. And thats also what I would pay if i was looking at a PPR.

Just this weekend a friend of mine was successful in securing a unit in Croydon. As an investor, I would not pay more than $500k (based off its rental income), however if you look at sales history, units in the same block were sold for $495 in 2010, $500 in early 2013, $495 in late 2013. All of similar condition.

I spoke with the agent on his behalf tried to secure it prior to auction, he said the owner would be happy with an offer of $540k, but as auction was in 5 days time, at $540k there would be an auction before an auction (by way of phone bids) and he just didnt want that. So he said, if i offered $580k he felt that was enough to make it worthwhile. On auction day, it sold for $619k so someone else.

My friend went to the auction of another unit in the same complex later that afternoon and won it at $571k. While to me it was still overpriced, in light the sale in the morning, i thought it was a good price.
 
144sqm is huge for an apartment. Strathfield is a premium suburb in the surrounding area, so 680k in relative terms not so out of the mark

I have a 40 yr old Fairfield unit with only 70 sqm and its near the 300k mark... I couldn't quite understand how people can afford it there
 
Big house in Kellyville as PPR vs unit in Strathfield as PPR.

It comes down to your priorities.
1. I like my sleep
2. I like to come home and see my kids
3. A train ride of 25 mins to the City appeals to me (even if it means i have to stand 95% of the way)
4. I prefer a train over a bus (especially in wet weather - have you seen how miserable those people look waiting for the express bus on Clarence St in the afternoon especially when its pouring rain!)

So i would go for Strathfield instead of Kellyville.

That said, if i worked out Parramatta, Norwest, North Ryde, then i would consider Kellyville. Convenience means more to me than a big house.... hell i want both :p
 
neK said:
Big house in Kellyville as PPR vs unit in Strathfield as PPR.

It comes down to your priorities.
1. I like my sleep
2. I like to come home and see my kids
3. A train ride of 25 mins to the City appeals to me (even if it means i have to stand 95% of the way)
4. I prefer a train over a bus (especially in wet weather - have you seen how miserable those people look waiting for the express bus on Clarence St in the afternoon especially when its pouring rain!)

So i would go for Strathfield instead of Kellyville.

That said, if i worked out Parramatta, Norwest, North Ryde, then i would consider Kellyville. Convenience means more to me than a big house.... hell i want both :p
Click to expand...

Def agree on the people waiting for a bus near Clarence St. It makes me laugh and I would never do it.

Agree with the other reply on Kellyville vs Rhodes. I def think time is more important.

I'm also aware that the market has somwhat sky rocketed over the past 6 months. I stress about it every day on not buying something back then.

Thanks for the replies.
 
I am catching the bus every day on Clarence st, it is a much better experience than before when used to packed like sardines on the train at townhall, and rainy days on trains with no air con!
 
MightyWill said:
It was however a 144sqm unit
Click to expand...

Looking at the floor plan this seems a bit off, even including the balcony and garage space.

These two below would have been a good comps and hint that you probably weren't going to tie it up in the low $600's

http://www.domain.com.au/property/sold/apartment-unit-flat/nsw/strathfield/?adid=2011029753

http://www.domain.com.au/property/sold/apartment-unit-flat/nsw/strathfield/?adid=2010976775

Remember it takes 3 months for sales data to bounce from the VG office to data houses so you really need to keep your finger on the pulse.
 
MightyWill said:
Strathfield is very central to outer west and inner west inc 13 kms to city but the suburb itself does not have much to offer apart from a Woolworths and schools and the obvious express trains to the city.
...
Any opinions?
Click to expand...

Remember, Strathfield houses are in 1.5 M range. Many houses are massive and sitting on large land but still you don't see many suburbs where unit prices are 1/3 of house prices.

This unit you are talking about is 144 sqm! That is massive. About 2.5 times of a granny flat :)


Here are my arguments for Strathfield from one of my previous post.


Strathfield is the true center of Sydney in my opinion

You can go to all major employment centres within 30 mins. Even though there are so many units around, I don't think the demand will ever go away.


Few more +ve points.. Only few mins away from
- cycle ways - I generally cycle to Olympic park with my kids
- good Tennis courts with in 5 min drive (Cintra park, Strathfield RSL, Dean street & greenlease )
- good swimming pools (Enfield & Olympic park)
- Golf course
- many parks
- Flemington market - 5 min drive
- Airport access in about 30-40 min
- good Library (Homebush)
- many childcare centres
- Very good primary schools - Homebush public, South Strathfield public and a new one is starting from this year.
- Private schools : Meriden, Trinity, Santa Sabina, MLC (Burwood)
- Better than average secondary schools - Homebush boys, Strathfield girls, St Patrick's College
- Australian Catholic University
- 20-30 mins train to all employments centres (Parramatta, City or North Ryde ) - Changing jobs isn't a problem
- 1 Buddhist temple, 1 Hindu temple and many churches
- Good food (Strathfield- Korean, Homebush - Indian, Homebush West - Chinese)
- Cafes (Near Strathfield & Homebush stations)
- Hospital and other medical facilities
- Retirement villages
- Very popular among wealthy Koreans - To me there are one of the trouble free and polite community. Girls are very nice too :)
- popular among rich migrant doctors (there is a doctors den!)
- Awesome Christmas light set ups :)


-Ve point:
Away from water.


I was thinking of buying a property closed to even better public high school. I couldn't find any other place worth moving to.


Disclaimer:
1. I live in this area
2. I worked in Korea (but not Korean)
 
went to peek at an auction of a 2br villa in Drummoyne probably about 5weeks ago ... there must have been 80 people there and many bids were exchanged ....:eek:

villa is pretty standard, not particularly big, similar to a 2br unit but with a small courtyard and the garage is right next to it, in good condition, probably built 15 years ago, can move in without doing work, low strata, 10min walk to bay run, no views

whilst there are many townhouses and units, there aren't many villas in the area

i suspected maybe it would sell for mid to late $800ks max ...

auction went on and an elderly looking man ended up winning it for $990k! :eek::eek::eek:

suspect the baby boomer has sold his big house for millions and just wanted to downgrade to something low maintenance without giving up on the house lifestyle

it's nice and all, but at the end of the day it's practically a 2br ground floor courtyard unit (though there won't be any annoying neighbours above you)

vendor must have been sooo happy
 
cadence said:
suspect the baby boomer has sold his big house for millions and just wanted to downgrade to something low maintenance without giving up on the house lifestyle
Click to expand...
You might be right. It could be the same reason for the Starthfield unit as well. It is large enough like a house. Perfect downsizer if you want to live the same area.

cadence said:
it's nice and all, but at the end of the day it's practically a 2br ground floor courtyard unit (though there won't be any annoying neighbours above you)
Click to expand...
Well.... unit is a unit and villa is a villa. They have differences which reflects in the price tag. Following the same logic, a house is practically the same as villa except the neighbours are closer? :rolleyes:
 
MightyWill said:
I went to an Auction in Sydney's inner west on Sat (Strathfield) to bid on a 2 bed that needed a new kitchen, bathroom, carpet and paint. The total reno would cost anyone 30 - 40 mark for a mid range job.

My budget was around the 625 mark with a prediction it would go anywhere from 610k to 635k mark. Brought my friend along as well who lives in the area.

It sold for 680k and if we factor in the reno work of 40k, it really costs 720k for a low rise, 20 year old unit with strata at 700pq. Recent sales in the street and neighbouring streets were around 620k with reno already done to the place.

My prediction was way off and I'm glad I didn't go in thinking I had a real chance or any emotional attachment.

It was however a 144sqm unit, only one bathroom, main bedroom was prob bigger than a double by another metre each way and a lock up garage and carport. The kitchen and bath was prob a sixe you find in a house so that was the selling point.

If we look at say Zetland or even Rhodes, this is prob how much you would pay anyway but it would obviously be a lot newer.

Strathfield is very central to outer west and inner west inc 13 kms to city but the suburb itself does not have much to offer apart from a Woolworths and schools and the obvious express trains to the city.. It looks like it?s being run down from all the rental tenants in the suburb. School don?t really matter for me at this stage for a PPOR.

By the way, it would appear the vendor had a reserve of 700k and it took them about 15 mins over the fone for them to accept the 680k offer. A bit of greed in my opinion.

Here is the property.

http://www.realestate.com.au/property-apartment-nsw-strathfield-116431675

Would you rather buy a house near Kellyville for this price?

I think I have to scratch Strathfield off my list now.

Any opinions?
Click to expand...

I'd be buying a house for that sort of cash western sydney.

The phllipino, Indian Sri Lankan community is inundating Plumpton, Hassal Grove, Mount Druitt areas.
Won't be long before they start to gravitate into other areas, Dharruk/WHalan etc.
Find something near new around these areas and you should go ok over next 10 years.
 
692k for that property!?!? It looks like the market has gone crazy!

Honestly, I think Rhodes is an area that does not look as bad value as it used to in my honest opinion.

I know there are alot of apartments in Rhodes leading to increased supply, however it is possible to get a much newer nicer 2 bedroom apartment in a more convenient location for almost 700K. What do you guys think?
 
There are better options than Rhodes for investment purposes imo. I go there once a month and while it has good transport and shopping, the supply there is just massive. Reminds me of Zetland, except even more dense.
 
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