I've been holding some stock in Frankston since 09 and it hasn't done much, don't know if it ever will. Whats your thoughts? I can stay and lose more money in the meantime waiting for it to hopefully go up (good tax cuts though..) or sell and buy somewhere else
Frankston: Hold or sell?
- Thread starter investor2009
- Start date
Developers Paradise
Frankston is definitely a strong buy at the current low prices. The local council is very pro-development and there are few places in beachside Australia where one can buy an old house on a large subdivisible block, keep the house and build another up the back. All for barely $300,000. often less~!
I am from the USA and have been investing in property for almost 40 years. I own a few houses in Frankston and know all the bad news about the place. When all is said and done, Frankston's crime rate is well below what you see in Venice or Marina del Rey.....and prices in Frankston are a third of what recessed Americans are paying for the same sort of property.
Mispricings like this may last for awhile, but they don't last forever. I like Frankston because its cheap. No other reason. People have overplayed the bad news about the place. Which is fine because it allows bottom fishing folks like me to get in on the cheap. Most of my acquisitions were made last year. I plan to hold for around 5 years. First build to commence later this year.
Frankston is definitely a strong buy at the current low prices. The local council is very pro-development and there are few places in beachside Australia where one can buy an old house on a large subdivisible block, keep the house and build another up the back. All for barely $300,000. often less~!
I am from the USA and have been investing in property for almost 40 years. I own a few houses in Frankston and know all the bad news about the place. When all is said and done, Frankston's crime rate is well below what you see in Venice or Marina del Rey.....and prices in Frankston are a third of what recessed Americans are paying for the same sort of property.
Mispricings like this may last for awhile, but they don't last forever. I like Frankston because its cheap. No other reason. People have overplayed the bad news about the place. Which is fine because it allows bottom fishing folks like me to get in on the cheap. Most of my acquisitions were made last year. I plan to hold for around 5 years. First build to commence later this year.
I bought in Frankston North in 99 for 95k. It was freshly renovated at the time.
That property is now and IP and has been for 10yrs, and worth around 230-250k in the current market. The market has slumped a lot with all the road works around the area for the new by-passes, but once they are established and all finished, and as the market picks up again, I can see prices going up again in the area. You have only owned it 4yrs, and not great years at that, so I'd suggest hanging in there for a while to really reap the rewards of the long term investment.
That property is now and IP and has been for 10yrs, and worth around 230-250k in the current market. The market has slumped a lot with all the road works around the area for the new by-passes, but once they are established and all finished, and as the market picks up again, I can see prices going up again in the area. You have only owned it 4yrs, and not great years at that, so I'd suggest hanging in there for a while to really reap the rewards of the long term investment.
frankston is a funny one, its a suburb that everyone loves to talk about, either you hate it or love it
bear in mind that rents have fallen slightly over the years, or stayed the same which is not positive,
that being said, ask yourself, where can you get a beachside location for $300k within 50km of the city? and see the suburbs around frankston and their medians
mt eliza, mordialloc etc. etc. even seaford
yes its also known as single mother territory as well as drugs drugs and more drugs,
turn on the tv and if you hear murder, it used to be frankston/north
in the long run, this area will be a no brainer, esepcially with zoning changes happening or being planned
but yields are pretty poor at around 5%
they are cleaning up central, not sure how much work is being done on north though,
in 20 years time, it wouldnt surprise me if people would be saying, "darn I should have bought, $300k for a beachside suburb sandwiched within bluechips was a no brainer"
bear in mind that rents have fallen slightly over the years, or stayed the same which is not positive,
that being said, ask yourself, where can you get a beachside location for $300k within 50km of the city? and see the suburbs around frankston and their medians
mt eliza, mordialloc etc. etc. even seaford
yes its also known as single mother territory as well as drugs drugs and more drugs,
turn on the tv and if you hear murder, it used to be frankston/north
in the long run, this area will be a no brainer, esepcially with zoning changes happening or being planned
but yields are pretty poor at around 5%
they are cleaning up central, not sure how much work is being done on north though,
in 20 years time, it wouldnt surprise me if people would be saying, "darn I should have bought, $300k for a beachside suburb sandwiched within bluechips was a no brainer"
I'm in a similar position.
Bought a property in Frankston North around 2-3 years ago on a 650m2 block for $270k that is now worth around $275k. Rent has gone down by $10 and I'm currently looking for a new tenant which is taking time.
Tempting to sell and I will if necessary but holding on for long term growth.
No joy owning this place at the moment so trying to focus on the long term.
Bought a property in Frankston North around 2-3 years ago on a 650m2 block for $270k that is now worth around $275k. Rent has gone down by $10 and I'm currently looking for a new tenant which is taking time.
Tempting to sell and I will if necessary but holding on for long term growth.
No joy owning this place at the moment so trying to focus on the long term.
unfortuantely, you bought at the peak,
prior to the boom/jump, north was selling for $205-$220k, around 09ish,
I had under contract a 650m2 inside the golden triangle in central (main road though) for $280-$285k, now that would be worth $300-$320k, original place, but at these times, north was $60k less, now the differene is more about $50k
what rent are you getting?
having lived in Mt eliza in melbourne (suburb away from frangers) and San Jose in the states, i would say you gotto compare apples with apples.
LA is gang capital of the world - and venice beach and those areas are miles away from what you expect in melbourne standards.
Frangers on the other hand in terms of melbourne is probably among the worst suburbs to live in..... whether beach side or not. it is like dandenong and doveton.
THey have been saying frankston is the next biggest thing but It has a bad stigma and the quality of tenants and lack of growth in income will not advance the capital growth you can expect in other suburbs. i would rather just put my cash in a term deposit.
Right, that buy was definitely not my best. It is my worst.
Rent was $270 a week and my tenant left the end of Feb and so far no new one so the PM has dropped the price to $260.
So it is tempting to sell but I'd only do that at this stage if I hit my financing service ability wall and have a better IP to invest in.
One reason I find this thread interesting.
Yes, I'm in Frankston central but block is 550sq so probably no redevelopment potential, I'm not sure about this though? It's definitely been my worst performer and worst cash-flow drain that has not improved whatsoever.
Hi Investor2009,
I have a couple of IP's in Frankston and have had them since 2005 and 2006 respectively.
I've had a lot of trouble with one - tenants leaving etc, chasing rent and so on. The other I initially had trouble with, but did a reno and have had the same tenants since 2007.
Rents haven't moved much over this period of time. Capital growth has been mediocre. I plan to sell these at some point in time - probably when prices increase again. I've put off selling as I would need to pay capital gains tax and I have established a LOC against one of the IP's to use for further investment. (I managed to gain a free title by shifting equity around from other IP's that had grown in value - was an interesting exercise and really made me see the value in investing in property!!)
Rents in Melbourne are generally static at the moment, and in many places have fallen, so this is not unique to Frankston.
If you sell now, how much of a haircut will you take? Would you buy another IP elsewhere, or invest funds in shares etc?
Depending on your situation and how troublesome your Frankston IP is, I'd be tempted to sit it out and wait for prices to rise to at least recover your entry and exit costs.
All the best with it.
Regards Jason.
I have a couple of IP's in Frankston and have had them since 2005 and 2006 respectively.
I've had a lot of trouble with one - tenants leaving etc, chasing rent and so on. The other I initially had trouble with, but did a reno and have had the same tenants since 2007.
Rents haven't moved much over this period of time. Capital growth has been mediocre. I plan to sell these at some point in time - probably when prices increase again. I've put off selling as I would need to pay capital gains tax and I have established a LOC against one of the IP's to use for further investment. (I managed to gain a free title by shifting equity around from other IP's that had grown in value - was an interesting exercise and really made me see the value in investing in property!!)
Rents in Melbourne are generally static at the moment, and in many places have fallen, so this is not unique to Frankston.
If you sell now, how much of a haircut will you take? Would you buy another IP elsewhere, or invest funds in shares etc?
Depending on your situation and how troublesome your Frankston IP is, I'd be tempted to sit it out and wait for prices to rise to at least recover your entry and exit costs.
All the best with it.
Regards Jason.
i have lived in frankston for 2 years and i love it!!!!!! i have the best neighbours possible and i currently live off skye rd. its been a great buy!!!! i wouldnt be selling it anytime soon. i have nearly finished my renovation i bough for 320 and i may have bought at a peak time but i dont really care im looking for long term growth i know its worth alot more than 320!!! so im happy there, itll rent out straight away and i can make sure i can pay it off as fast as possible while i travel and work elsewhere!!
my block is 550 also but i cant subdivide which i never planned on. townhouses in my street are wanting 350+ which is great for me, land appreciates, buildings depreciate
as far as im concerned frankston hasnt boomed yet, but it will come
'
nick.
my block is 550 also but i cant subdivide which i never planned on. townhouses in my street are wanting 350+ which is great for me, land appreciates, buildings depreciate
as far as im concerned frankston hasnt boomed yet, but it will come
'
nick.
they said that in the 90s about the massive boom in frankston... and it hasn't happened yet.. guess you're right - we should wait another 10-20 years.
What was the median price back in the 90's for Frankston?
A lot of ppl agreeing doesn't mean anything. Denial more like acceptance.
the fact is low wages and criminal elements (troublesome tenants similar to some that have mention earlier) in the frankston area can really only deter capital growth
there was an article in an investment blog (catering to overseas chinese) which basically advised anyone to stay clear of frankston. Distance from the city, criminal elements, rough neighborhood etc etc.
Honestly i went there once last year and it hardly had that much growth in terms of buildings etc etc from early 90s when i was schooling in mt eliza.
the fact is low wages and criminal elements (troublesome tenants similar to some that have mention earlier) in the frankston area can really only deter capital growth
there was an article in an investment blog (catering to overseas chinese) which basically advised anyone to stay clear of frankston. Distance from the city, criminal elements, rough neighborhood etc etc.
Honestly i went there once last year and it hardly had that much growth in terms of buildings etc etc from early 90s when i was schooling in mt eliza.
Low wages and criminal activity, when some areas are developed the demand increases, those with higher incomes move in... Rents increase, this increase can force "druggies" to look elsewhere for cheaper rent and so on...
So far that demand/growth hasn't happened.
Mind you more then 100% growth in 10 years, something's happening
Then there is the self-fullfilling prophecy. Enough punters saying it moves a market forward enough that it sucks in the people following a short growth phase, in turn making development more feasible, removing riff raff housing and upping rents. Then the demographic changes as Brady has mentioned can take place.
Don't think it will happen any time soon, but when it does I doubt it will give enough time for many people to move before taking off.
Don't think it will happen any time soon, but when it does I doubt it will give enough time for many people to move before taking off.
Fraaaaaaangeerrrrrr
I've lived in Frankston and surrounding suburbs since the 80's and i still reckon Frankston is all over the shop - this coming from someone who knows nothing about Investing - just from living there. Frankston Sth - great if you bought in the right era - with bay views. Karingal used to be great but i think is a bit of a dive now. it's hard to pick - get the right place in Seaford/Frankston and you're laughing - get the wrong place and you'll find needles in the walls. i reckon a long term hold in Frankston will see you right but will it ever be huge benefits? - and whoever said it - please don't compare Frankston with Dandenong/Doveton. those places are in a league of their own.
is it worth having the best house on the worst street?
I'm still considering a Sth Frankston purchase but it would definitely have to have a sub division option sized block. There's a few ripper blocks hidden in there with demolishing ripe homes ready to go. Build up and look over the trees.
I've lived in Frankston and surrounding suburbs since the 80's and i still reckon Frankston is all over the shop - this coming from someone who knows nothing about Investing - just from living there. Frankston Sth - great if you bought in the right era - with bay views. Karingal used to be great but i think is a bit of a dive now. it's hard to pick - get the right place in Seaford/Frankston and you're laughing - get the wrong place and you'll find needles in the walls. i reckon a long term hold in Frankston will see you right but will it ever be huge benefits? - and whoever said it - please don't compare Frankston with Dandenong/Doveton. those places are in a league of their own.
is it worth having the best house on the worst street?
I'm still considering a Sth Frankston purchase but it would definitely have to have a sub division option sized block. There's a few ripper blocks hidden in there with demolishing ripe homes ready to go. Build up and look over the trees.
Thanks all. My plan has been to sell in another three years hoping for enough growth. Id be happy with another 100k and pay off our mortgage. Whaddya reckon. Likely?
Honestly I'd be holding. I got a report from my rp data today and it said my house is less what I've paid for it. I laughed!!! In saying that its renovated and when I bought it it was a shitheap (if anyone's seen my Reno blog) but ill be renting my place out as its a perfect time to get attendant in to smash my repayments!!
So in conclusion, don't sell, hold on for another 3 years as you said. That's my best advice for you
So in conclusion, don't sell, hold on for another 3 years as you said. That's my best advice for you
