Where to buy a 1 or2 brm unit in Sydney?

[Sally]

I am new here. I have been lurking and reading, reading, reading, and this is my first post.

I want to buy a one or two bedroom unit in Sydney and have been looking at inner city areas as well as the Lower North Shore, and have a couple of questions.

Firstly - on timing - before finding this site I was thinking that it might be a good time to buy in Sydney, but I have read a few posts here indicating that this might not be so. Would I be better to wait a while and, if so, why? (Sub-prime issue, interest rates, new govt, US recession talk ...???) How long would it be best to wait?

The other thing I would like to ask is in relation to location. For 1 or 2 brm units in the inner city/LNS spread, are there any suburbs or locations that stand out in terms of having particularly good prospects for capital growth? (I have read the discussion on Redfern).

Thanks

 

[Francesca C]

Hi Sally

We can all indicate that it is a good time or not a good time to buy and where we think the hot spots are. If only we had a crystal ball.

Personally, for long term holds if I am after capital growth... I always go for water of some description, lakes, river, preferably ocean.

Statistically, without any boom, your city property will double ever 7-10 years however, water side property will treble every 7-10 years. This is because of the land value and that you cant build water. Everyone loves water, whether it is lakes, ocean, even man made. Have you noticed most developers are including man made lakes in their development.

Units/flats do not fit into my strategy because I always buy land for capital growth. Land appreciates and buildings depreciate

I always look for an older property sitting on as much land as I can afford.. ie. I would rather a 1960s house sitting on 1000sqm of land than a brand new house on 250sqs.

The reason I do not like units is because buildings do go up in price however the increase is usually only made through inflation. Consistent capital growth is made from land value. Land is in limited supply and the more scarce that land is and the more limited its supply ie. water the more it will be sort after and will increase in price.

Always remember the higher the land content, the greater the capital growth.

Most property investor buy units, me personally I stay away from them. You own no land or a very small percentage.

According to property mentors you need at least 30% land content to be certain of consistent growth. I usually work on alot more than that but this should be your miniumum.

Just my thoughts :>

Remember before buying a property work out the land value and building value.. and always make sure the building is min 30% i usually work on alot higher.

 

[jingo]

The reason I do not like units is because buildings do go up in price however the increase is usually only made through inflation. Consistent capital growth is made from land value. Land is in limited supply and the more scarce that land is and the more limited its supply ie. water the more it will be sort after and will increase in price.

Always remember the higher the land content, the greater the capital growth.

Most property investor buy units, me personally I stay away from them. You own no land or a very small percentage.

According to property mentors you need at least 30% land content to be certain of consistent growth. I usually work on alot more than that but this should be your miniumum.

Just my thoughts :>

Remember before buying a property work out the land value and building value.. and always make sure the building is min 30% i usually work on alot higher.

Hi Francesca,

As you mentioned scarcity is really the key to selecting a successful investment. The scarcity of the land in any given area is a key consideration. In the major capital cities there are many examples of flats, units (free standing) and town houses increasing in value at the same rate as houses due to the shortage of land and town planning constraints preventing developers from supplying the market with further stock.

Care must be taken to select a flat, unit or town house that is in a lower density development, and preferably in an area where there is no available land to develop more stock. I would not recommend buying into a residential tower complex, but again, that is just me, and there are probably others who have done this very successfully!

Regards Jason.