Peter
Whatever you may personally feel is the best option, reality is that people still choose to buy with a wrap, and that includes Melbourne suburban. I sold 3 in Melbourne just last month.
Also, the whole point of wrapping is to get cashflow - it's a cashflow business, not a property investing strategy. However at some point that excess cashflow can then be used to buy long term buy and holds which provide the capital growth element.
John
I am surprised that you say Rick Otton suggests prices below $200k, I have certainly never heard him say that. If anything, he says the opposite - you can wrap anything as long as it's not a total "war zone" of a suburb. Having said that, it may well be best to start off with something cheaper in an outer suburb, so you can follow your learning curve without paying out too much. Just pick a cheaper outer suburb near wherever you live. There's no such thing as a "right" suburb to wrap in.