Where to spend 300k in Sydney?

[jmillar]

Given a budget of 250-320k, where would you look at buying in Sydney right now?

I'm looking for property with 7-8% yields for instant neutral/positive cashflow with a good outlook for capital gains in the short term, to allow me to continue acquiring property. Would be happy to settle for a 6% yield to get better outlook for CG though.

I would prefer a house or villa over unit but willing to consider all options.

What areas should I look at?

Thanks

 

[georgie1]

Given a budget of 250-320k, where would you look at buying in Sydney right now?

I'm looking for property with 7-8% yields for instant neutral/positive cashflow with a good outlook for capital gains in the short term, to allow me to continue acquiring property. Would be happy to settle for a 6% yield to get better outlook for CG though.

I would prefer a house or villa over unit but willing to consider all options.

What areas should I look at?

Thanks

For $300k?

You are most likely looking at a unit unless you head far away to area's that are considered part of the Greater Sydney area but are not Sydney for a house.

Best way to get CG and continue building your portfolio is to buy a run down property, fix it and then hopefully with ur renovations you increase the value and rental income and can withdraw the equity for the next property.

 

[devank]

Given a budget of 250-320k, where would you look at buying in Sydney right now?

I'm looking for property with 7-8% yields for instant neutral/positive cashflow with a good outlook for capital gains in the short term,

I can only think of Auburn Units. No one can predict the CG part.

 

[ozmale42]

Given a budget of 250-320k, where would you look at buying in Sydney right now?

I'm looking for property with 7-8% yields for instant neutral/positive cashflow with a good outlook for capital gains in the short term, to allow me to continue acquiring property. Would be happy to settle for a 6% yield to get better outlook for CG though.

I would prefer a house or villa over unit but willing to consider all options.

What areas should I look at?

Thanks

House or vila for $250k to $320k = Blacktown or Mt Druitt area

Units for that price = one bedders in Marrickville based on another thread i read in the forums recently

 

[euro73]

Sydney's barely shown any growth in 5 or 6 years for the most part. Yields are quite strong, so that side of your wish list is probably easy to achieve, but its Russian roulette trying to guess where some growth might come from.

You'd need to create enough equity to access another deposit of @ 45-50K
( 10% deposit plus stamp duty and costs ) for another "cheapie" around 300-320K. That would require 15-20% growth within a couple of years to meet your plans.... may happen, may not...Russian roulette like I said.

General consenus amongst "experts" seems to be that the Western suburbs are considered the better bet, but 250-320K would still see you reasonably limited for choice in suburbs that arent quite derelict.

I think that sort of money would probably be better put to work somewhere regional like Ballarat, Bendigo, Townsville, etc. Just my 2 c. I'd also suggest taking a close look at NRAS, to boost your post tax returns to 9 or 10% tax free. Regional property with NRAS at a 300K budget can be quite potent. Again, just my 2c. It's not for everyone.

If you are set on Sydney, it will definitely need to be 2nd hand stock, probably 12-15 years old or more. You'd be looking for a bit of a rough diamond and hoping to get lucky, basically.

St Mary's, Emu Plains, Smithfield, St Clair, Mt Druitt, Auburn (as Devank suggested) - you may get something reasonable in one of those kinds of suburbs...

 

[virgo]

Penrith

Penrith, something like this:
http://www.realestate.com.au/property-house-nsw-penrith-112682527

 

[thepeoplesagent]

I'm looking for property with 7-8% yields for instant neutral/positive cashflow with a good outlook for capital gains in the short term, to allow me to continue acquiring property. Would be happy to settle for a 6% yield to get better outlook for CG though.

I would prefer a house or villa over unit but willing to consider all options.

What areas should I look at?

Hawkesbury!!

Don’t know about 7-8% return but certainly 6%. You could even pick up a free standing home or Torrens title duplex. Keep in mind that some villas, units etc some with strata fees.

I had two sell this week. One was a duplex with no strata costs. It sold for $285,000 and currently rents for $350 p/w. Another one which was a free standing home sold for $305,000 and would rent for $360 p/w, more if you were prepared to paint and tidy up.

 

[scha9799]

CG is hard to say.

For 300K you can get house in greater western sydney easily.
North from St Marys, Mt Druitt to South Minto, Campbelltown areas....

Yield is about 6% (some 5.5%, some 6.5%).

Back to CG, it's hard to get the nature CG in the area, it's becuase they are outer suburb and plentiful of land avaliable. Many of the land release around the outer suburbs....

but you can certainly get some run down houses and do the work, maunfacturing some CG yourself... ( many of the investors are doing that so the run down houses are very competitive ). I think good connection with quality tradies are important to lower the reno cost and boost more return.

I hope this will help.

Good luck

Taylor

 

[jmillar]

I can only think of Auburn Units. No one can predict the CG part.

Hmm Auburn seems well recommended and looks to be well priced. Will do some research on the demographics etc. Thanks!

House or vila for $250k to $320k = Blacktown or Mt Druitt area

Units for that price = one bedders in Marrickville based on another thread i read in the forums recently

Thanks for the suggestion. I'm fairly comfortable with the Blacktown area and its central location. Will do some further research on the area.

WIll check out Marrickville while I'm at it. I'm not too familiar with the area, and I would want to ensure the unit is more than 50sqm but I don't mind the idea of buying something affordable in a well located area with a high median price. I would think this would have a low vacancy rate and a better class of tenants, but will do my own due diligence here.

Sydney's barely shown any growth in 5 or 6 years for the most part. Yields are quite strong, so that side of your wish list is probably easy to achieve, but its Russian roulette trying to guess where some growth might come from.

You'd need to create enough equity to access another deposit of @ 45-50K
( 10% deposit plus stamp duty and costs ) for another "cheapie" around 300-320K. That would require 15-20% growth within a couple of years to meet your plans.... may happen, may not...Russian roulette like I said.

General consenus amongst "experts" seems to be that the Western suburbs are considered the better bet, but 250-320K would still see you reasonably limited for choice in suburbs that arent quite derelict.

I think that sort of money would probably be better put to work somewhere regional like Ballarat, Bendigo, Townsville, etc. Just my 2 c. I'd also suggest taking a close look at NRAS, to boost your post tax returns to 9 or 10% tax free. Regional property with NRAS at a 300K budget can be quite potent. Again, just my 2c. It's not for everyone.

If you are set on Sydney, it will definitely need to be 2nd hand stock, probably 12-15 years old or more. You'd be looking for a bit of a rough diamond and hoping to get lucky, basically.

St Mary's, Emu Plains, Smithfield, St Clair, Mt Druitt, Auburn (as Devank suggested) - you may get something reasonable in one of those kinds of suburbs...

Thanks for your advice. I don't really care too much about what the growth will be throughout Sydney in the next few years, as I have no control over this. I am only concerned at this stage with buying in the right part of Sydney so that when we do see growth, I am riding the biggest part of the wave I'm aiming to have minimum of 10 houses by the age of 30, so I'm not concerned about predicting exact growth as a whole - as long as I have a diversified profile then I'm happy to accept the fact that I am ensured a considerable amount of growth in the long run.

Penrith, something like this:
http://www.realestate.com.au/property-house-nsw-penrith-112682527

Thanks virgo. I am familiar with Penrith so will definitely be doing some further research on the area. I just don't see a great deal of development and/or improved infrastructure coming to 'the Riff' compared to some other areas.

Hawkesbury!!

Don’t know about 7-8% return but certainly 6%. You could even pick up a free standing home or Torrens title duplex. Keep in mind that some villas, units etc some with strata fees.

I had two sell this week. One was a duplex with no strata costs. It sold for $285,000 and currently rents for $350 p/w. Another one which was a free standing home sold for $305,000 and would rent for $360 p/w, more if you were prepared to paint and tidy up.

Sorry mate, I've gathered you work for Starr Partners but which office? And where in Hawkesbury were these properties? Would definitely consider this area (depending exactly on its location) given the amount of growth indicated by the Government to happen in the area (which will bring significant infrastructure etc).

Thanks

CG is hard to say.

For 300K you can get house in greater western sydney easily.
North from St Marys, Mt Druitt to South Minto, Campbelltown areas....

Yield is about 6% (some 5.5%, some 6.5%).

Back to CG, it's hard to get the nature CG in the area, it's becuase they are outer suburb and plentiful of land avaliable. Many of the land release around the outer suburbs....

but you can certainly get some run down houses and do the work, maunfacturing some CG yourself... ( many of the investors are doing that so the run down houses are very competitive ). I think good connection with quality tradies are important to lower the reno cost and boost more return.

I hope this will help.

Good luck

Taylor

Hey mate,
Thanks for the advice. I definitely intend to purchase a property with good renovation potential, so as to leave an option available if there is no growth happening and I want to 'manufacture' my own equity!


Thanks everyone for the great responses, these have definitely provided me with some more food for thought!

 

[Finrod]

Resides

You could also look into some of the budget residex reports for ideas.

I've found them quite handy for identifying suburbs which I may not have otherwise encountered. E.g most people would have heard of Blacktown, but not all of its neighbouring suburbs.

They also breakdown suburbs with houses vs units, and even have a renovator's report.*

Well done on starting so young btw!

F.

 

[jmillar]

Thanks for the tip, will certainly check that out and do my due diligence on some of the suburbs mentioned!

 

[monty python]

+1 for Reisdex report ... We used one of these a few years ago and ended up buying in one of the suburbs recommended, this property has seen excellent rental demand and growth, and no problems, but is in an area we would not have otherwise considered. That's not to say they always get it right, however we are happy with our outcome.

 

[tang]

+1 for Reisdex report ... We used one of these a few years ago and ended up buying in one of the suburbs recommended, this property has seen excellent rental demand and growth, and no problems, but is in an area we would not have otherwise considered. That's not to say they always get it right, however we are happy with our outcome.

which subarb?

hi OP, i am looking to purchase my next IP with the same budget

smithfield, as suggested, would be a great option for houses however it extends above your range

fairfield has units available however supply looks greater than demand at the moment, therefore i am steering away. CG does not look attractive

for your range, you will have to look at blacktown, carramar for units, st marys

 

[Alex1]

Hi,

I have had a good experience purchasing a 2 bed unit in Mt Druitt last year -
$214000 and rented to existing tenants for $310.

I see Capital Gains as a constant - overtime they will go up, some more then others, its harder to predict for a first time buyer with a tighter budget. If the mortgage is affordable and the rent return is good, you will be able to save faster and purchase the next property sooner then if you were waiting for increase in CG and relying on equity to fund the next purchase.

Hope this helps

 

[Jacque]

Sorry mate, I've gathered you work for Starr Partners but which office? And where in Hawkesbury were these properties? Would definitely consider this area (depending exactly on its location) given the amount of growth indicated by the Government to happen in the area (which will bring significant infrastructure etc).

Hey Johnno

Pretty sure Brian is based in the Windsor area from his posts- also assuming he's referring to suburbs like Bligh Park with his sale examples.
Best of luck with your quest