Whats happening in your area???

From: Robert Forward


Hi Everyone

I'm just posting what I see happening in my area that I live. How about we all add to this post to see if there are some commonalities that are forming around Australia

With the increase of prices in Sydney you will still find it extremely hard to find a cashflow positive property. Especially at the moment, take for instance my area that I live. Over the past 4 weeks the "For Lease" section in the local rag was 2 1/2 pages big, last week it was 4 and this week it is now 5 1/2 pages long.

Now, I went hunting last weekend for a 3 bed rental house to live in. 3-6 months ago I would have been paying $320+pw last weekend showed that rentals have fallen dramatically and I can now rent a 3 bed house in my area for $260/270 negotiable (so lets say $250pw).

So there is going to be some landlords that are really going to start hurting soon as who is really going to move over the Xmas period.

I have an RE Agent who is taking a property to auction on the 15/12 and he's said "It must be SOLD" as the owner has committed elsewhere and it must be sold prior or at auction. The Agent is getting desperate with his calls, he rang me 4 times on the same day. The owner needs to sell and auction clearance rates are dropping dramatically.

So what I see occurring is possibly the start of the drop/correction of Sydney property prices. I state this is only what I see and only in the area that I know in Sydney, the market could be at different stages throughout the rest of Sydney but I do know that Sydney's vacancy rate is now heading towards double digit figures (they are already there in my area).

Looking forward to everyone elses comments.

Cheers
Robert

The Sydney "Freestylers" Group Leader.

PS: "Be Not Afraid Of Growing Slowly, Be Afraid Of Only Standing Still."
 
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Reply: 1
From: Peter Davidson


Hi Robert,

I live inner city Melbourne and also looking for an investment property worth my while. Although clearance rates are hovering around 50-60%, house prices are still fairly hot. It seems as if people are happy not to sell if they don't get top dollar. So, what do I see happening in the next 6 months, probably more of the same.

Property has changed, it is no longer for investors, it's for every man and his dog and therefore I think property will just keep on getting stronger and stronger. Although I wish it didn't, I want to buy!!!

Pete.
 
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Reply: 2
From: Owen .


Got to agree with you Rob. I have a unit for lease at the moment and even at low rent, there is no-one out there even looking. The values are still relatively high although not like 3 months ago. Won't last either. I don't know if I would like to be selling anything right now though as 'for sale' open homes are pretty empty too.

It the coming together of all the big influences, FHOG and low interest rates have pulled all the tenants out of the market, 1br unit sold out and the prices went through the roof because of it. This forced the value of everything else to rise too. It made a big void in the rental market and the prices dropped accordingly. All those 'investors' who jumped in to late, paid to much and are now caught in that void. This could only continue for so long though because regardless of FHOG and cheap money, only so many people are in a position to buy. I think we have reached a bit of a saturation point and this, combined with the traditional summer slowdown and loads of latecomers trying to cash in, has meant lots of stock and no-one to buy it. Excellent if you are in a position to buy and can ride the low rental returns.



Owen

"Gambling promises the poor what property performs for the rich – something for nothing"
 
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Reply: 2.1
From: Robert Forward


Thanks for the reply Owen. Sorry to hear that your having probs getting a tenant.

Another thing I'm seeing is that properties are now being listed at a $$$ price rather then going to auction. And also RE Agents are trying to sell properties before they get to the auction date.

Cheers
Robert

The Sydney "Freestylers" Group Leader.

PS: "Be Not Afraid Of Growing Slowly, Be Afraid Of Only Standing Still."
 
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Reply: 2.1.1
From: Michael Croft


Hi Guys and Gals,

Believe it or not there is only a few weeks left 'til Xmas which is a traditionally slow period for home buyers. Most agents I know have wound down the listings (saving them for Jan) and are concentrating on getting the pre Xmas sales across the line. Buyers/tenants also tend to slow or stop purchases/leasing in early/mid December and don't reappear 'til mid/late January. The point being I wouldn't judge the market (rental or sales) on the results over the next 6 to 8 weeks. Wait 'til Feb/March. Longer term trends definitely.

Anecdotally, I have a three bed duplex vacant at the moment and am taking the opportunity to do a reno. It will be back on the market in mid/late Jan 2002 (peak time). Haven't had a vacancy on this one in 8 years and it needs a reno desperately. Anticipate no probs letting it at an increase of $70 pw post reno (reno will cost about $10k - new kitchen, carpet, paint, curtains/blinds, built in robes etc.)

Another half of a different duplex (2 bed) just let at same $ rate (no vacancy) and the tenant offered to paint it. She's painted a couple before, all I had to do was supply the paint ($200). Will I put the rent up after she's done a good job?? I'm not a total bastard so we'll compromise at 75% of a full market increase (suppose that makes me 75% of a bastard!).

Michael Croft
"The best parachute folders are those who jump themselves."
 
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Reply: 2.1.1.1
From: Travis Boutses


G'day all,

I'm from Eastern Melbourne, about 15km's out of city. I've noticed a bit of a slowdown, but good properties still hot, hot, hot!!

The crappier ones either can't sell or not getting top dollar like they were few months ago.

I think the market will shoot upwards again come Feb\March next year due to demand being up and supply being down. Prices should go up about 10% next year I believe.

I don't think there will be a fall.
 
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Reply: 2.1.1.1.1
From: J Parker


Like Robert, I too am in Sydney (Hills area) and have noted alarmingly the price increases over the last 12 months. Nothing decent in houses now under $340K. As for rentals, the pages in the local rag have slowly increased and it's the first time I've seen pictures of commonly priced rental properties. Renters can take their pick!!

Who knows what is going to happen in Sydney? But I like the idea of a downturn, particularly if interest rates start to climb end of next year, as that's where the bargains will be!

In the meantime, I'm going to my other fav city, Brissy. I've got to start doing this interstate thing to avoid all that nasty land tax! Cheers, Jacque :)
 
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Reply: 2.1.1.1.1.1
From: Michael G


Hi,

I live at Quakers Hills (rent) and own a townhouse there.

In '98 in was worth $167k, now probably $240-250k.

I sold a duplex in march this year for $225k, and equivalents now would be about $260k.

Mind you my townhouse rents for $230/wk and I'm renting in a duplex for $230/wk also.

But council is pour alot of $ into roadworks with two major roads getting increased from 2 to 4 lanes.

at the beginning of this year there were a lot of new estates created between the rail line and Sunnyholt Rd, these are tiny blocks with "cubes" put on them (so called mansion homes with no eves and square-as).

For a long time nothing was on there, but there are now home being put on there, don't know if anyone lives in them yet.

We also have the Windor Rd getting extra lanes, and the old windsor rd, seven hills rd bottleneck is getting an underpass which will improve traffic flow.

There is also the Rouse Hill Development area to consider as well as proposed Castle Hill Rail Link off the Parra-Epping line, but the money for that was supposely spent in Windsor Rd.

The other thing thats coming along is the Orbital and that's coming through Quakers Hill, so I wont be selling anytime soon.

So sadly the yeilds are low, but there's little to deflate the prices either, with Quakers being one of the few 'burbs with both a rail and major road link in the west.

I think development might be the way to get into this market, but I lack the skills to do so, and I'm a tad nervous about the amount of $ one would need to get into this market.

On the other hand, with all the boxes going up, a half decent developer with just a tad of style building something with a touch of character i think would be able to move stock faster than the mass builders.

Any developers wanna talk please feel free to contact me :)

By the way, this aint advice, just my views.

Michael G.
 
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Reply: 2.1.1.1.1.1.1
From: Joanna K


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Michael,

Give me a call if you come across any opportunities.

Kind regards

Joanna Karavasilis
Principal

THE RENTAL SPECIALISTS

PH: 02 9599 3363
FAX: 02 9599 3447
EMAIL: rentals@rentalspecialists.com.au
WEB: www.rentalspecialists.com.au


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Michael,

Give me a call if you come across any
opportunities.

Kind regards

Joanna Karavasilis
Principal

THE RENTAL SPECIALISTS

PH: 02 9599 3363
FAX: 02 9599 3447
EMAIL: rentals@rentalspecialist=s.com.au
WEB: www.rentalspecialists.com.au=


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