Weekly Market Update - 7th August 2017
By | 7th Aug 17

WATCH: Finance Tips - The Changes in Interest Only Loans 

Melbourne’s market continues its solid run with a 77% clearance rate from 668 auctions. There were again some record results and we saw a house in Clarendon Place, South Melbourne sell for $500,000 or 45% above reserve, equating to $16,000 per square metre of land. We have found over the years that many clients that have purchased property interstate have not had great results and made major mistakes by overpaying and also buying the wrong property that does not achieve the capital growth targets that they want it. We recently had a client who sold a property in Coomera, Queensland for $545,000 and they have held that property for nine years and lost money as they paid $585,000 for it. Many buyers purchase interstate because prices seem cheaper but that does not necessarily make it the right purchase of an investment grade property.

 

Fully furnished properties and Air BNB can be a great way of achieving higher rental returns and improving cash flow for investors. Some of our clients now are using these strategies to try and increase their rental returns and increase their cash flow as they can often rent for 30% to 50% higher rates then when they are unfurnished. Though there are some downsides in terms of higher vacancy rates and other pros and cons with fully furnished rentals or Air BNB. Recently we were quoted in an article by Hayley Goddard, click here to read more about some of the pros and cons of this investment strategy.

 

Well ‘The Block’ is up and running in Regent Street, Elsternwick and on TV again and should be another exciting series with houses back which will be a popular purchase for many investors and owner occupiers as houses with land value are highly sought after in the current Melbourne market. Each of these houses has around 400 to 450 square metres of land which will be a big attraction to these properties. We have rented out quite a few of the previous Block properties and Will and Carly’s property from the last series in Port Melbourne just rented for $1900 per week fully furnished, so they have offered great returns as discussed earlier. Fully furnished rentals can be a very good strategy for increasing your rental returns as well as offering close to $90,000 in tax depreciation for The Block properties.

 

Please don’t hesitate to visit our website www.advantageproperty.com.au or contact us regarding our popular Buyer’s Advocate, Vendor Advocacy, Property Management, Owner’s Corporation services and Group Block Purchases, including our future villa unit opportunity at 159 O'Shanassy Street, Sunbury (from $238,000 each, with rental return of approximately $225 to $235 per week or 5%) and also the two bedroom apartment opportunity at 5 Herbert Street, Dandenong (approximately $250,000 returning approximately $225 to $240 per week)