澳洲Australia property Doing your homework | Sydney


在澳大利亚 I am in Melbourne. Would like to buy properties interstate. How difficult is that to manage these properties. Any advise. 评论 Do you mean manage to find them or manage as in property manager? 评论 Manage to find a good property manager 评 Hi everyone, After months of searching for my first IP I believe finally have the corage to put in my first offer. I would love some feedback Property: Duplex Asking price: $239,000 I believe it is worth $225,000 to $230,000 My Offer: $218,0


Had an interesting chat with our PM the other day about low rental yields as opposed to high medium house prices. Here in Mandurah an entry level 3x1 would cost about $360K and would return on average about $160-180p/wk. These figures are easy enough to find out - a quick internet search or a thumb through the property guide. Anyway, our PM commented that her biggest problem lately is new investors who've purchased an IP believing it would rent for about $300 p/wk. Apparently this is what the selling agents are telling them and they're being sucked in. Our PM said she's seeing several investors a week at least in that position - they come in looking to list their IP's with her but when she gives them the "real" rental assessment they go visibly weak in the knees. Usually they don't believe her and go see a few other PM's before the truth finally sinks in. The problem for many is that they have borrowed 100% plus costs and now with a slowing in the market they can't afford to sell. I don't imagine the latest interest rate rise will help. What I don't understand is why anyone would be prepared to spend close to $400K minimum without doing some thorough research first.

Flatout  

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because they are sheep - we saw the same on the east coast 2 years ago, those who don't know what they are doing jumping on the end of the boom wave only to get caught out.

keep an eye on them - they will be the first to sell once the boom stops, and very possibly for a loss.  

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One sign of the top (and a bubble) people who buy with either no idea of the fundamentals or that the fundamentals no longer matter.

I'm sure many people justified their purchases in Sydney in 2003 by saying 'yields of 2% are ok because prices will rise to cover that!' not realising that rent is part of the fundamentals of price rises over the long term.
Alex  

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When these people sell out to home buyers, the market then forms a firm base. $400k for a new unit or villa in Mandurah is difficult to get your head around, for now anyway but in 10 years time when average salaries are $100k, it would be peanuts for its location. However how many can afford to hold one or even two for that 10 years when you're only getting $200 p/wk in rent?

I think the difference between Peel and out East is that people bought cra* IPs out west (our west is not Cottesloe) and there was simply no follow through demand and rental for homes out there. New migrants want to live close to family and friends and seeing we still have a hang over from the White Australia policy, we no longer hand out refugee visas willy nilly. Guys who come over are professionals and most often than not, bring wads of cash over with them - as you guys in WA are experiencing from the SAfas and Poms. These guys want to live close to work, city and good schools.

Also a lot of IPs that were bought were old and needed work and hence would rent for a lot less without improvements. The investor was on the right track - buy land content but land is not worth much out there. If you're going to spend $ reno'ing, why wouldn't you do it in a sought after area? Pay a bit more for the piece of dirt? The tiler or plumber will charge pretty much the same no matter where your IPs are.

The flush out will be fun to watch... all these beginner investors plunging in head first without checking the depth. We're now into interesting times to see who will swim or sink.  

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flatout said: ↑
What I don't understand is why anyone would be prepared to spend close to $400K minimum without doing some thorough research first.

FlatoutClick to expand...
Never underestimate the stupidity of the human race.

Mark  

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flatout said: ↑
cost about $360K and would return on average about $160-180p/wk.Click to expand...
Hmmm, 2.6% gross return. Not bad.

I'm looking at a place with 1% nett return.....and the homework has been thorough. Sometimes people go into the deal with their homework done and their eyes open, and yet the yield is woeful.

Sometimes other factors make it well worth while.  

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The difference is that you do your homework Dazzling. On the other hand, people who take the selling agents' estimate of achievable rentals without taking the trouble to get an estimate from another agent or looking at rents in the newspaper ...  

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