SYD: cheaper housing commision area's out west
- Thread starter tigerGT
- Start date
You Slumdog millionaire you!
...don't worry it is a compliment...I get called it all the time.
If you bought houses at the prices below you nailed some bargains. The stuff today would be now 230k (depending on condition and street and a lot now have owner only clauses) as a minimum. They were going a lot higher 250k plus...but have dropped off a bit now a fair market value is about 260-280k (depending on condition)....so you have made a cool 70-100k per house. This is similar to the houses I picked in outer areas around the country in the last 4 years. Have you still got all of them???
What are your rents like today.... 250pw-280pw??
What is you land tax like? I am just about to pay it (next year) as I have just passed the NSW threshold of 379k after my Woy Woy purchase. Have 2 pearlers i am looking at Southwestern and Western Sydney....the only issue is the land tax is $1600 per 100k of land value.
What is the land values associated with your Mt Druitt homes. Till now my porfolio only consisted of unit within 15klms of the CBD and their aggregated values was about 205k.
...don't worry it is a compliment...I get called it all the time.If you bought houses at the prices below you nailed some bargains. The stuff today would be now 230k (depending on condition and street and a lot now have owner only clauses) as a minimum. They were going a lot higher 250k plus...but have dropped off a bit now a fair market value is about 260-280k (depending on condition)....so you have made a cool 70-100k per house. This is similar to the houses I picked in outer areas around the country in the last 4 years. Have you still got all of them???
What are your rents like today.... 250pw-280pw??
What is you land tax like? I am just about to pay it (next year) as I have just passed the NSW threshold of 379k after my Woy Woy purchase. Have 2 pearlers i am looking at Southwestern and Western Sydney....the only issue is the land tax is $1600 per 100k of land value.
What is the land values associated with your Mt Druitt homes. Till now my porfolio only consisted of unit within 15klms of the CBD and their aggregated values was about 205k.
George, I have 8 houses in Sydney. Two are in Campbelltown (Ambarvale) & the other 6 are in the Mt Druitt area (2 x Willmot, 3 x Lethbridge Park & 1 Tregear).
You say that Western Syndey was missed a little in the boom. Well, that's not quite accurate. Go back a few years & you could get an ex-housing commission home in Mt Druitt for under $100k. Unfortunately I didn't buy into the area back then.
At the moment, if you play your cards right you can purchase for around $200k & get around 5% yield. I bought 4 last year @ $153k, $180k, $185k & $196k. The rents on those same properties, in the same order, $230, $190, $200, & $220. My yields, as you can see, are a little better than average. They are all ex-housing commission.
The Campbelltown properties are in a private area & I like them better than the Mt Druitt ones. They are newer properties than the Mt Druitt ones too. One of them was originally purchased to be our PPOR & then we decided to move. The first of these was purchased in 1996 for $90500. It is currently worth around $240k & gets a rent of $210pw. The other is more upmarket & gets a rent of $265pw.
I am getting a better yield from the Mt Druitt properties than the Campbelltown ones. As far as maintenance is concerned, they are all about the same (with the exception of the Ambarvale one with the pool - don't get a pool). Quality of tenants are variable. The better Ambarvale one has always had great tenants, while the other has had a mix. Mt Druitt gets a mix as well.
Before the prices started to rise, it was not unheard of to get a 10% yeild in both areas.
If there is anything else I can help with just let me know.
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You Slumdog millionaire you!
If you bought houses at the prices below you nailed some bargains. The stuff today would be now 230k (depending on condition and street and a lot now have owner only clauses) as a minimum. They were going a lot higher 250k plus...but have dropped off a bit now a fair market value is about 260-280k (depending on condition)....so you have made a cool 70-100k per house. This is similar to the houses I picked in outer areas around the country in the last 4 years. Have you still got all of them???
What are your rents like today.... 250pw-280pw??
What is you land tax like? I am just about to pay it (next year) as I have just passed the NSW threshold of 379k after my Woy Woy purchase. Have 2 pearlers i am looking at Southwestern and Western Sydney....the only issue is the land tax is $1600 per 100k of land value.
What is the land values associated with your Mt Druitt homes. Till now my porfolio only consisted of unit within 15klms of the CBD and their aggregated values was about 205k.
LOL! Who knew this post would jump up again?
Yes, they are all houses. We still have all but one of those properties and have added to the portfolio since then.
As far as rents go, those four houses mentioned are getting, in the same order as before, SOLD, $260, $280, $280 plus $150, maybe a little more, but we'll see. That last one has a granny flat that was leased with the house, but is vacant currently as we are doing a little work on it, but will be rented soon enough. Not entirely sure what it will rent for yet, as I haven't really been looking what the rents are on something like this.
We refinanced two of them when Westpac had it's all time low rates of 4.99%, so they are well and truely cf+. We should have done more, but some were on fixed rates & we couldn't. Still, two at that rate is better than none.
As for Land Tax, well, don't swear at me.
We were paying a simply astronomical amount, as we held some of the Sydney ones in a Trust structure, which means there is NO threshold, and there are some more in the portfolio outside of the mentioned Sydney ones. We have sold three out of the Trust, making it a lot more realistic. From memory we only paid a tiny (by comparison) amount this year.To find the exact amount the land is worth would mean me going through all my paperwork (which I avoid at all costs) and looking it up. It amounts to somewhere just under/over the $2k mark for each property in the Housing Commission area, as they all have the same land value. Two of ours are on the same block and we're not about to subdivide them anytime soon (even though we can) because that will only double the land tax AND rates on that property. At the height of the boom we got them revalued for not a lot less than if they were stand alone properties, so there really isn't a good reason for the expense of doing the subdivision.
OK thanks.
Here in my lies my dilemna....I can see Sydney rocketing in terms of property...but need to balance against CF due Land tax costs. I have said I will get about $1m in land value which means I will pay about $9500 per year in land tax. I jut have to ensure that CF is there to pay it...and hopefully rapidly rising rent will assist with this.
Here in my lies my dilemna....I can see Sydney rocketing in terms of property...but need to balance against CF due Land tax costs. I have said I will get about $1m in land value which means I will pay about $9500 per year in land tax. I jut have to ensure that CF is there to pay it...and hopefully rapidly rising rent will assist with this.
yo, i bought in Leth park 2770 in 99 for 76K. Could have sold in Oct 03 for 240K but I pulled out ( as I had dreams of $300K). Today (7 years later!) you can buy in for less than 220K eg 38 Palmyra sold for 212K.
This means a boom in the Druitt may be just around the corner. rents are mostly over 280pw
If you have multiple properties and are worried about land tax, try investing in one property, but make it agood one, land tax can be deferred and it may be CGT free if its principal residence!
This means a boom in the Druitt may be just around the corner. rents are mostly over 280pw
If you have multiple properties and are worried about land tax, try investing in one property, but make it agood one, land tax can be deferred and it may be CGT free if its principal residence!
Prices are held low because Housing NSW are regularly releasing properties to the market and the area isn't very appealing to the general public yet. This will change over time so if you wait prices will go up. In the meantime, rental returns are good
This is a great thread, invaluable to me as I am on the other side of Oz.
Am looking at jumping in sooner than later. Would also like your thoughts on Blacktown.
I purchased a property in Doonside about 8 months ago, been told this is a shocking area. Have good tenants in place, touch wood.
I paid $315K and am now achieiving $570 pw ($370 pw house, $200pw granny flat).
Would like to repeat this in Blacktown.
Cheers and M Xmas
Am looking at jumping in sooner than later. Would also like your thoughts on Blacktown.
I purchased a property in Doonside about 8 months ago, been told this is a shocking area. Have good tenants in place, touch wood.
I paid $315K and am now achieiving $570 pw ($370 pw house, $200pw granny flat).
Would like to repeat this in Blacktown.
Cheers and M Xmas
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Blacktown has to be better area than Doonside coz of its major shops, transport hub and better class of people for want of a better phrase.
Doonside, then again is a notch up on the suburbs of Mt Druitt such as Tregear,Blackett etc. however Old Mt Druitt is not too bad. Some nice houses on big blocks.
Generally, the more expensive the median price of a suburb, the better the suburb.
Prices of real estate in Sydney metro will always go up in the long run. Blackett and Tregear etc seem to be about $100K cheaper than surrounding suburbs that are not under the Mt Druitt "curse".
I have also invested in Cabramatta 2166. A deadly suburb 15 years ago with a serious out of control herion problem. Police have since cleaned most of it up and will "jump on a junkie" on sight.
The Vietnamese community love cabramatta and rents/property prices have gone up significantly over the last 18 months. This place is as tight as a fishes..most units are over 30 years old with no real highrise apartments, only 3 storey walk ups.
I first bought in Cabra way back in 1982 (2br unit LUG ,Park Rd $34K), then Fisher St in 1993 (1 br unit LUG $73K) then St Johns Rd (1 br unit, tandem garage plus 2 storerooms of 33 sqm) for $140K in 2005.
I have sold my first 2 properties and these properties have never been vacant. House prices in Cabra are very expensive, near the shops in John St are well >$1m. further out on large blocks are over $600K.
Doonside, then again is a notch up on the suburbs of Mt Druitt such as Tregear,Blackett etc. however Old Mt Druitt is not too bad. Some nice houses on big blocks.
Generally, the more expensive the median price of a suburb, the better the suburb.
Prices of real estate in Sydney metro will always go up in the long run. Blackett and Tregear etc seem to be about $100K cheaper than surrounding suburbs that are not under the Mt Druitt "curse".
I have also invested in Cabramatta 2166. A deadly suburb 15 years ago with a serious out of control herion problem. Police have since cleaned most of it up and will "jump on a junkie" on sight.
The Vietnamese community love cabramatta and rents/property prices have gone up significantly over the last 18 months. This place is as tight as a fishes..most units are over 30 years old with no real highrise apartments, only 3 storey walk ups.
I first bought in Cabra way back in 1982 (2br unit LUG ,Park Rd $34K), then Fisher St in 1993 (1 br unit LUG $73K) then St Johns Rd (1 br unit, tandem garage plus 2 storerooms of 33 sqm) for $140K in 2005.
I have sold my first 2 properties and these properties have never been vacant. House prices in Cabra are very expensive, near the shops in John St are well >$1m. further out on large blocks are over $600K.
Anyone who owns =< median price homes will most likely soon likely be a house commission home.
Look around people...
Look around people...
I take offense to this comment. Who do you consider a "better class of people?"
We have lived in the Mt Druitt area for around nine years and invest quite heavily in the area. We have also lived in Blacktown area. Both Mt Druitt & Blacktown have Housing Commission Properties, however I have noticed that Blacktown has a much higher density of new immigrants than Mt Druitt. According to a PM that has them looking for rentals all the time, quite a few seem to be coming from war torn areas and are having trouble adjusting to our way of life. They are violent, especially to women, and she has been seriously threatened a couple of times by them. This is coming from a very quiet laid back woman.
There are many good, hard working people living in both areas. If you want to attract a "better class of person", then you need to make sure that your IP's are clean and well maintained, but that you have a good property manager too. This goes for ANY area.
Doonside is not better than Mt Druitt, it is just closer to Blacktown.
Mt Druitt sits close to the station. Fanning out on one side, you have the Housing Commission areas, of course many of them have been sold to private owners now, but this is the area that most are concerned with.
On the other side of the station is Old Mt Druitt with older houses on bigger blocks and Colyton. Then you have the nicer suburbs of St Clair, Erskine Park and Minchinbury.
Curse? OK, I know many people have a problem with Mt Druitt, but I would hardly call it a curse. Mt Druitt has a stigma about it. It is usually the uninformed that think that anyone who lives out west is either a druggie or a single mum. That just isn't the case.
Mt Druitt is a working class suburb. It has a higher than average number of people on lower incomes mainly because it is cheap. There are also some very wealthy people living in the area. There are heaps of FHO moving out this way each year. Some will stay and others will use it as a stepping stone to move elsewhere.
The Ex-housies are around $100k cheaper than a similar size home in St Clair, however St Clair is a much newer suburb with brick & tile homes whereas the ex-housies are mostly fibro and really not as appealing to the eye as St Clair. The newer homes, however, where they have knocked down the original and rebuilt, are not really any cheaper than the "better" suburbs.
I once knew very old man who brought in a suburb that in that time was considered the lowest of the lows.
He needed to buy two properties in the lates 1940's to accomodate his large family and that of his sister's as her husband had died. He simply purchased the best thing he could at the time.
Long time friends never came to visit and his was often branded as a loser at work because of his suburb choice.
It was not until the 1980's did he prove everyone wrong.
He had brought two very large adjoining waterfront terraces at Balmain.
In the 1970's he said people has started to realise the proximity to the CBD and in the 1980's the heat was on.
Good lesson to learn.
He needed to buy two properties in the lates 1940's to accomodate his large family and that of his sister's as her husband had died. He simply purchased the best thing he could at the time.
Long time friends never came to visit and his was often branded as a loser at work because of his suburb choice.
It was not until the 1980's did he prove everyone wrong.
He had brought two very large adjoining waterfront terraces at Balmain.
In the 1970's he said people has started to realise the proximity to the CBD and in the 1980's the heat was on.
Good lesson to learn.
Thanks Skater for tip. I am in the process now of getting separate metre as this was an issue.
Good luck with your properties you are sitting on potentially great growth over the next couple of years. Excellent stuff.
I have also learnt some very valuable lessons over the past 10 years of investing.
Cheers, MTR
Datto spot on about Cabramatta.....unlike the 90s where it had a very bad reputation it is now very vibrant due to the Southeast Asian community.
Originally the Vietnamese, Camdodian, and Lao kids left Carbra to other parts of the city. Overtime they have moved back to their roots bought the older houses, knocked them down, and put uo huge houses. This has really pushed up the prices in these areas. Additionally, some of the more enterprising ones have become developers who have built a lot of smaller developments.
As for Blacktown it is a very broad area.....areas like Doonside and some of the Mt Druitt subrubs are not doing as well.
However, there are parts of Blacktown i.e. Glenwood, Stanhope Gardens, Quakers Hill, Acadia Ridge, and Kellyville Ridge which are very very expensive....you could be paying up to 800k for a houses. There areas tend to have a lot of professional immigrants from Phillipines, India, Sri Lanka, and other parts of Asia. These areas continue to do really well.
As I have expressed previously, there Dept of Housing is selling a lot of the Mt Druitt suburbs off but it will be a while before these areas really start taking off with CG though you could comfortably get 6-7% today.
I have bought ex housing commission...my preference to get something where there is a scarcity factor. Thus why I bought a house in Woy Woy on the Central coast. The change there is quite dramatic...a lot of young families from Sydney are moving there.
Originally the Vietnamese, Camdodian, and Lao kids left Carbra to other parts of the city. Overtime they have moved back to their roots bought the older houses, knocked them down, and put uo huge houses. This has really pushed up the prices in these areas. Additionally, some of the more enterprising ones have become developers who have built a lot of smaller developments.
As for Blacktown it is a very broad area.....areas like Doonside and some of the Mt Druitt subrubs are not doing as well.
However, there are parts of Blacktown i.e. Glenwood, Stanhope Gardens, Quakers Hill, Acadia Ridge, and Kellyville Ridge which are very very expensive....you could be paying up to 800k for a houses. There areas tend to have a lot of professional immigrants from Phillipines, India, Sri Lanka, and other parts of Asia. These areas continue to do really well.
As I have expressed previously, there Dept of Housing is selling a lot of the Mt Druitt suburbs off but it will be a while before these areas really start taking off with CG though you could comfortably get 6-7% today.
I have bought ex housing commission...my preference to get something where there is a scarcity factor. Thus why I bought a house in Woy Woy on the Central coast. The change there is quite dramatic...a lot of young families from Sydney are moving there.
Yes, Sash you are right, however the Blacktown I was talking about was more central than the nice areas around the outskirts. The newer estates have some very impressive homes and, of course, prices to match.
It is true the prices around this are have been only moving slowly the past few years, but they will get their day in sun, and I don't think it will take all that long. In the meantime, the yields are nice and you can certainly get more than a 7% yield if you look really hard, added to this that the demand is strong so there is upward pressure on the rents.
"Doonside is not better than Mt Druitt, it is just closer to Blacktown."
You have got to be kidding me skater
Forget sentiment and anecdotal.
Look at the facts. Doonside median price of house $337,000, Tregear $228,000. what about Lethbridge Park $230,000 (source domain.com.au).
Heck, Ive got a house in Lethbridge Park and I would swap it anyday for a similar house in Doonside. That way I would be laughing so hard as I go to the bank to cash up that Id have to see a doctor to get my sides stitched up!
You have got to be kidding me skater
Forget sentiment and anecdotal.
Look at the facts. Doonside median price of house $337,000, Tregear $228,000. what about Lethbridge Park $230,000 (source domain.com.au).
Heck, Ive got a house in Lethbridge Park and I would swap it anyday for a similar house in Doonside. That way I would be laughing so hard as I go to the bank to cash up that Id have to see a doctor to get my sides stitched up!
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The reason why Doonside has a higher median is parts of it are around new housing such as "Wood" someting....and there are also new homes there.
Yes, there are some shocking parts of Doonside....but also some nicer parts near new estates.
Blacktown council is one of the largest in Sydney...as Skater said things can be dramatically different.
It is true....that you could pick a house up for say 200k put 7k in and rent it for about 310pw. About a 8% return.
Yes, there are some shocking parts of Doonside....but also some nicer parts near new estates.
Blacktown council is one of the largest in Sydney...as Skater said things can be dramatically different.
It is true....that you could pick a house up for say 200k put 7k in and rent it for about 310pw. About a 8% return.
I think you are referring to Woodcroft?
I have a friend who bought in Doonside and made similar comparisons to datto. She now wishes she bought in Mt Druitt.
It really depends on the streets themselves rather than the suburb. Whenever you have a large number of low socio-economic families living together you will have more issues than the norm. Whether it is 10km or 15kms from Parramatta has nothing to do with it.
I have a friend who bought in Doonside and made similar comparisons to datto. She now wishes she bought in Mt Druitt.
It really depends on the streets themselves rather than the suburb. Whenever you have a large number of low socio-economic families living together you will have more issues than the norm. Whether it is 10km or 15kms from Parramatta has nothing to do with it.
Exactly right! The median price for a home in a suburb plays absolutely no part in how good a suburb is. The median for Doonside is higher, simply because it is closer to Blacktown/Parramatta AND people don't associate it with Mt Druitt, but you still have the same demographic.
In both Doonside and any of the H/C suburbs of Mt Druitt you will find that you have a small number of trouble makers. Purchase near a "troubled" family and you will find that you encounter problems but there are also many parts of the H/C areas that are very quiet and livable.
