Forums / Property Investing / Help Needed! / Help on city apartment!

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  • Profile photo of Xquis8Xquis8
    Member
    @xquis8
    Join Date: 2004
    Post Count: 1

    Hi

    im thinking of purchasing a one bedroom aparment in melbourne on lonsdale st. Its about 20 sqm. The real estate agent (my friend) reckons hes got a lease for a year of $300pw (yet to be confirmed). The apartment is a private sale selling at $192 000. Im just wondering on everyones opinion on whether the price and rental is a good investment for the location.

    any reply is most welcome
    cheers

    Profile photo of Mortgage HunterMortgage Hunter
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    @mortgage-hunter
    Join Date: 2003
    Post Count: 3,781

    Tough to finance something that small. Affects the resale value.

    Give me a call and we can have a chat about some issues.

    Simon Macks
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    0425 228 985

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    Comments may not be relevant to individual circumstances. If you intend making any investment, financial or taxation decision you should consult a professional adviser.

    Profile photo of DerekDerek
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    @derek
    Join Date: 2004
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    Hi Xquis,

    I would be very concerned if you were buying a unit that small as an investment. Lenders have a great aversion to financing such small places and therefore you would be using more of your cash and/or equity as a deposit than is typically required.

    Because of this you could well experience difficulties selling the property later on if ever that was an option/need. Such difficulties tend to restrict growth potential as savvy investors tend to steer clear of such property.

    For me you are better off investing in something a little more standard and something that is bigger than 50 sqm.

    Derek
    derekjones1@bigpond.com

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    Profile photo of Mortgage HunterMortgage Hunter
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    @mortgage-hunter
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    Derek said it all :)

    Simon Macks
    Mortgage Broker
    http://www.mortgagehunter.com.au
    0425 228 985

    Todays Hot Rate
    ***3 year fixed – 6.49%***

    Comments may not be relevant to individual circumstances. If you intend making any investment, financial or taxation decision you should consult a professional adviser.

    Profile photo of elika7264elika7264
    Member
    @elika7264
    Join Date: 2003
    Post Count: 160

    Hi,
    20 square metres seems very small — one room at best. I doubt if this is a livable space[blink]. Have you got the measurements right??[ohno]
    $300 per week for 20 square metres — the figures don’t add up right.

    Maybe you were given the dimensions in squares (different from square metres).

    Go back to square one (no pun intended[biggrin]) and reconfirm with the agent all figures provided.

    Regards,
    Helen

    Profile photo of yuyuyuyu
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    @yuyu
    Join Date: 2004
    Post Count: 15

    20sqm on lonsdale? sound like a student accom, studio apartment. lettin at 300 is not realistic even fully furnished. I live in the city so i kinda know these market well. The location is good but the size and price look funny.

    Hehe dun think u can get 20 square one bedroom for under 200k, so must be square metre.

    cheer

    yuyu

    Profile photo of AndyWAndyW
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    @andyw
    Join Date: 2004
    Post Count: 9

    20 sqm is possible… my first place is 30m². Studio apartment, $165k, currently renting at $185 pw, furnished. There is another studio in the same building currently up for rent, asking $240pw (although it’s probably renovated, and has a car space). This is in Artarmon, (lower north shore, NSW).

    Purchase price sounds about right, rental sounds a bit high – have you done a domain.com.au search or something to get some comparison rental prices?

    It is hard to get finance for such a small place (as people have said, below the magic 50m²), you’ll need the full 20% deposit for starters, since no lender’s mortgage insurer will touch it.

    Profile photo of elika7264elika7264
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    @elika7264
    Join Date: 2003
    Post Count: 160

    Hi Yuyu,

    your post:

    dun think u can get 20 square one bedroom for under 200k, so must be square metre.

    It was not my intention to suggest a one bedroom apartment would be 20 squares. I was just querying whether Xquis8 had been given the figures in square metres or metres.[blink]

    Looking at the initial post again — $192K for 20 square metres — extrapolates to approx $400K for 40 squares metres; $600K for 60 square metres.

    In my opinion the apartment on Lonsdale street seems very expensive. When you consider its limited use (student accommodation only), the red flags start appearing. I think there are better investments out there — but then again, that’s my opinion only.[blush2]

    Regards,
    Helen

    Regards,
    Helen

    Profile photo of thecrestthecrest
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    @thecrest
    Join Date: 2004
    Post Count: 989

    Hi Xquis8
    Since you said any reply is most welcome . . . . I’ve gotta say the property sounds like a garage, don’t do it.
    I’d rather own half a good quality property, than all of a bad one, if ’twere my money. Don’t dodge debt, dodge bad investment.Quality properties seem to be the only ones appreciating all the time.
    cheers
    thecrest

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    Profile photo of BrizzaBrizza
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    @brizza
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    1 bedroom, 1 bathroom 42 square metres.

    Would I have troubles getting finance?

    Profile photo of TerrywTerryw
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    @terryw
    Join Date: 2001
    Post Count: 16,058

    Brizza

    St George will do small places – from memory, anything over 25 sqm.

    I have heard of someone with a 12 sqm ‘place’ in Sydney. The person paid cash for it 10 years ago and it hasn’t gone up and they couldn’t find a buyer.

    Terryw
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    North Sydney
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