Western Sydney House upto $500K and should I use a Buyers agent?

[MaxRobbins]

Hi All,

Im sure I'm not the only one, but really interested in buying a house in Western Sydney whist I can still get something for around $500K. Is this realistic, or have I missed the boat already. The market seems very fast that way.

Still very new to this so thinking of engaging a buyers agent to help identify suitable areas and properties.

Does anyone have any recommendations on both areas in Western Sydney and buyers agents who focus on this area. Most of the buyers agents I have spoken with seem to only cover the inner ring and middle ring at a push.

Thanks

Max

 

[Biz]

The boat has sailed. Chill your beans for a few years and look into it later or look in other areas.

Edit: Just checked a property I went to look at a few weeks ago:

http://www.realestate.com.au/property-house-nsw-cranebrook-118892855#

"that" went for half a million beans LOL. It was a tidy house but it had a structural issues with the bricks craking all the way to the ceiling. Right around the corner from housing commission hell Pendock street.

Don't be that guy.

 

[bob shovel]

Yeah as above, head north to the sunshine state!

 

[Danieljk101]

Western Sydney is ridiculous. My brother in law just bought a house in Glenmore Park (near Penrith) for $860k. It's about 10 to 15 years old, 4x2x2 theatre room and nice outdoor area with pool.

My other brother in law just sold their 25 year old 4 bedroom house in St Clair for $790k and had almost 20 offers on it.

Crazzyyyy.

 

[Jacque]

Hi Max

Not sure how much research you've done but there's a few BAs who work in western Sydney- our company included. Also check out fellow members (who are also here on Somersoft) Propertunity and Propertybuyer- REBAA colleagues as well. NSW list here: http://rebaa.com.au/members/nsw/

Whether or not to buy needs to be your decision and yours alone. Whilst a BA can assist with areas and properties that fit your brief and budget, as well as handling the assessment, negotiating and acquisition you need to be committed and realistic to make the most of the property purchasing experience. Even if the boat has "sailed" according to some, this doesn't necessarily mean that it's likely to return to dock to pick you up for the same (or a cheaper) fare a few years down the track... best of luck with your quest.

 

[Biz]

Even if the boat has "sailed" according to some, this doesn't necessarily mean that it's likely to return to dock to pick you up for the same (or a cheaper) fare a few years down the track... best of luck with your quest.

Maybe not but what is the benefit in buying in an area that has done its dash for this cycle? Mad Max needs to create equity to get the ball rolling. You're not going to do that in Penrith anytime soon.

 

[Propertunity]

Maybe not but what is the benefit in buying in an area that has done its dash for this cycle? Mad Max needs to create equity to get the ball rolling. You're not going to do that in Penrith anytime soon.

You may be right or you may be wrong - no-one knows or has the benefit of hindsight.

In my own personal opinion, from what I'm seeing on the ground, there is still plenty of steam left in this market yet. If the RBA cuts IRs again, as it did this month, it may grow another 10-15% this year. Let's see.

 

[RetireRich101]

In saying so, every suburb in Sydney has sailed, not just western sydney.
There are detached houses in a good size block under $500k that are good value.

There are still good development blocks I see value in, especially in Penrith Council.

I learned today with a phone call to Penrith Council, the Town Planner advised the new proposal is gazetted coming Monday. I think it is the 2010 Amendment 4.

This Penrith DCP looks promising compare to neighbor council like Blacktown.
as a guide,
you can build a dual occupancy on 550m2 land with 15m frontage (compare to North Ryde require 600m2 and 20m frontage). You can strata tile in Penrith but not in Blacktown..
Also R3, you can build multiple dwelling (townhouses/vila) on 800m2 and 18m2 frontage.
R2, you can dual occ on 750m2.
R4, you can build few floor apartment on 800m2 with 20m2 frontage.

(these are just recollection from my memory) but you google "penrith amendment 4" or call Council planner for more details.

 

[DaveM]

Plenty of sub 500k properties to be had in Penrith LGA still. You just need to know where to look and be prepared to do some renovation work

 

[MaxRobbins]

Thanks everyone,

So fairly mixed views on Western Sydney then lol. I'd really like something close to cash flow neutral and ideally with opportunity to develop further down the track and without going into country NSW, Western Sydney (particularly South West) seems to represent the best value to me.

Thank you for the buyers agent recommendations Jacque. Will certainly look into this.

Thanks RetireRich101, this type of future development potential definitely appeals to me. Does anyone know if buyers agents help look into the feasibility of site?

 

[my03]

While on the topic of western Sydney and cash flow neutral properties. Is it even possible to get something with that type of yield in western Sydney anymore?

Seems like even those properties with the potential to value add are going for well above the value requires to get the yield to be cf neutral or positive. Am I wrong in assuming that?

 

[MaxRobbins]

While on the topic of western Sydney and cash flow neutral properties. Is it even possible to get something with that type of yield in western Sydney anymore?

Seems like even those properties with the potential to value add are going for well above the value requires to get the yield to be cf neutral or positive. Am I wrong in assuming that?

Well I guess this depends on a couple of things like the amount of deposit and depreciation. Im basing my numbers off the purchase price though as if 100% financed as this gives a full picture. With interest rates being in the mid 4's cashflow neutral is definitely possible, I just hope once the fixed term is up that the rents have risen enough to cover everything.

 

[vaughan]

In the past couple of years property prices have gone up significantly but rents have stayed the same or even softened due to increased rental supply. Hence finding something cashflow neutral will be a challenge.

Fudging the numbers by using a big deposit to reduce the loan or relying on depreciation does not really improve the cashflow. That deposit could have been in another investment earning more money.

 

[MaxRobbins]

In the past couple of years property prices have gone up significantly but rents have stayed the same or even softened due to increased rental supply. Hence finding something cashflow neutral will be a challenge.

Fudging the numbers by using a big deposit to reduce the loan or relying on depreciation does not really improve the cashflow. That deposit could have been in another investment earning more money.

As per my last post. Calcs are based on 100% finance, so no deposit fudging here lol. I'd disagree re depreciation though as this can make a huge difference to the after tax position of the property. Particularly if you renovate or add a GF. Sure it gets added back at CGT time, but thats only if I sell. Which I have no intention of doing.

 

[RetireRich101]

Thanks RetireRich101, this type of future development potential definitely appeals to me. Does anyone know if buyers agents help look into the feasibility of site?

I don't have an answer since I'm not a BA, but interesting question though. The development potential assessment could be tricky and involved in most cases as NSW council DCP are fragmented and are all different. I am looking at a site in Lindfield over 1000m2 and can't subdivide or dual occupancy. Best use is a granny flat at the back. However with this size block, most council either allow strata or subdivision.

I am just a typical investor with time after a 9-5 job and like to learn, because I know this knowledge is a prerequisite moving forward if you want to succeed in this field.

 

[Red Car]

The development potential assessment could be tricky and involved in most cases as NSW council DCP are fragmented and are all different. I am looking at a site in Lindfield over 1000m2 and can't subdivide or dual occupancy. Best use is a granny flat at the back. However with this size block, most council either allow strata or subdivision.

Cant add granny flats in Ku-Ring-Gai can you?

 

[investra]

Hi All,

Im sure I'm not the only one, but really interested in buying a house in Western Sydney whist I can still get something for around $500K. Is this realistic, or have I missed the boat already. The market seems very fast that way.

Still very new to this so thinking of engaging a buyers agent to help identify suitable areas and properties.

Does anyone have any recommendations on both areas in Western Sydney and buyers agents who focus on this area. Most of the buyers agents I have spoken with seem to only cover the inner ring and middle ring at a push.

Thanks

Max

Given the size of western Sydney economy, the demand for housing is expected to sustain well over some capital cities/ regional towns. Recently unveiled development plans of Parramatta, Some of the large infrastructure projects in North West, Continued urban sprawl is expected to further help Western Sydney economy. Few pointers for your search ..

+ There are still properties sub 500k with good yields available and competition is high for good ones.
+ Agree with my03, that certain properties with value add potential end up selling at prices well above what’s its worth after a reno. Especially the houses with Granny flat potential get sold even before the open house.
+ Follow some of the big infrastructure projects areas for future growth. There are few cheap suburbs benefiting from ripple effect as well. Old houses located close to new house and land estates should do well.
+ Keep an eye for some streets getting complete face lifts, with investors fixing ex-housing commission houses, improving the street appeal and values.

Cheers
Jay

 

[strongy1986]

Well done to all those who have made a heap in Sydney over the years

But if you stand back from all the hype can you really see it going any higher in the near future

500k for entry level houses 60k from the CBD?

 

[Biz]

Well done to all those who have made a heap in Sydney over the years

But if you stand back from all the hype can you really see it going any higher in the near future

500k for entry level houses 60k from the CBD?

I can see it going higher but from here on anything made will be lost when prices correct as rates tick up.

 

[DaveM]

500k for entry level houses 60k from the CBD?

Penrith is 50km from CBD, but whats 20% overstatement between friends.

Also, not everyone works in the CBD. There is massive employment in the GWS area and that's where people work, 10-30 mins from home.

And contrary to popular belief, not all of GWS is ferals in housing commission fibros with old lounges on the front verandah. There is a LOT of money out here, and the majority of workers earn good incomes which coupled with affordable housing pushes up house prices ongoing.