Zenix apartment 1101 / 221 Sydney Park Road, Erskineville

1101, 221 Sydney Park Road Erskineville 1

FOR SALE: 1101, 221 Sydney Park Road Erskineville

Apartment 2 bed, 2 bath, 1 car

Built 2003

Size 111 sqm

Strata levies $1,361 per quarter

Current rent $625 per week

Asking price $650,000+ (July 2010)

THIS APARTMENT HAS BEEN SOLD for $674,000 on 10 September 2010

This apartment is has a north-facing aspect on the level 11 with city views. Facilities within the Zenix complex include a resort style swimming pool, tennis court, gymnasium and landscaped gardens.

Features of the apartment include floor to ceiling windows opening onto a loggia style balcony, open style kitchen with glass splashback, 2 bedrooms with built-in wardrobes and balconies, master bedroom with ensuite. It has one security car space.

Location wise, it is within 200m to St Peters train station, and cafe and restaurant precinct of Newtown and Erskineville.

Erskineville apartments median private treaty price is $533,000.

Source: Australian Property Monitors, 1800 817 616, homepriceguide.com.au

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Understanding property cycles

The Property Cycle

Source: propertyupdate.com.au

The old adage that property prices move in cycles is certainly true. However, there are many sub-cycles within the Australian property market cycle – state cycle, the cycle within a large cluster of suburbs and even individual suburb cycles.

Therefore, whilst understanding and appreciating general property cycles and where they are at a given point in time, investors also need to understand the sub-cycles which affect their investment portfolios. In boom times, there may still be suburbs which are laggards and vice versa, some suburbs may buck the trend in bear markets.

In general, June quarter figures show that Sydney median house price increased from $611,000 to $625,000, a rise of 2.3% or 13% for the year. However, this growth was contained in the most affordable areas:

Area / suburb

% growth

Inner west

0.6 %

Lower north shore

0.0%

West

3.2%

Sydney / eastern suburbs

-3.8%

South-west

2.4%

Canterbury-Bankstown

2.0%

Upper north shore

5.9%

Northern beaches

3.6%

Source: Australian Property Monitors, June 2010

Although  the above are merely quarterly figures, they do illustrate that in general, there exist sub-cycles within a lager property market. The affluent suburbs in the east experienced strong gains in 2009 and as a result, these areas may be taking a breather, whilst the inner west and lower north shore had very modest growth. On the other hand, the west and south-west areas of Sydney performed better compared to all other areas. The upper north shore which comprise suburbs like Lindfield, Warrawee, Turramurra and Hornsby showed the highest growth while northern beach suburbs like Seaforth, Manly, Dee Why and Collaroy were also strong.

The relatively more expensive and popular suburbs within the CBDs which are believed to hold their prices in slower markets may not always hold true. There have been some spectacular bargains for luxury apartments and penthouses in the city and the east recently. Although land scarcity is relatively lower in the more affordable suburbs away from the CBDs, some of these regional suburbs are more recession-proof in poor economic times. Home prices and rental rates may not experience significant falls as they are relatively more affordable and people still need to rent in such times.

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Infinity Property Agents ~ Passionate team of Sydney real estate agents

Infinity Property Agents 2

Michael Kurosawa -  Principal, Infinity Property Agents

Michael Kurosawa - Principal, Infinity Property Agents

Infinity Property Agents are property sales consultants and managers who specialise in the lower north shore, eastern suburbs, inner west and inner city areas of Sydney, Australia.

The Infinity team is headed by the Principal and Founder, Michael Kurosawa, who was previously  a Director / Partner of Realty Marketing in Neutral Bay providing specialised service and advice to regular clients which include Multiplex, Australand, Waltcorp, Macquarie Bank and Austcorp.

This dedicated team of Sydney real estate agents pride themselves in having a deep passion for customer service, knowledgeable in their respective areas of coverage and perpetuating lasting relationships with their clients. Infinity’s property management team conducts routine inspections every 5 months to provide a full photographed report with feedback and comments to their clients to ensure properties under their care are responsibly carried out.

Infinity Property Agents can be contacted at 9699 9179 or 0411 641 662 for your real estate requirements.

Scarcity ~ the new imperative over Location

Infinity pool

Infinity pool ~ functional and appealing

The property adage “location, location, location” is not only cliché, it is boring.

Any well-informed investor will understand that location must be a given and is one of the most important aspects of choosing the right investment property. It goes without saying that properties in less favourable locations which are close to a busy main road or having difficult access to public transport or in high density areas with overlooking issues will invariably suffer the obvious disadvantage over those which are located in more private precincts with easy access to public conveniences.

Having said this, less-informed investors will continue to buy ill-located properties perhaps out of necessity than investment savvy as these properties are often relatively more affordable. Hence, the emergence of 2-tier markets within a location and the notion the product is only as good as what you are willing to pay.

What is perhaps more telling when choosing an investment property is the “scarcity factor” of the property ~ something which is relatively unique, in short supply and in high demand to both owner-occupiers and tenants alike. Better still, an investor would be in good stead if he or she could find a scarcity factor within a well-located property. In this instance, not only do one satisfy the good location criteria, but also insulate one’s investment from the competition by having a particular feature or quality which is scarce and in demand. So what is this scarcity factor in property?

Lets examine some scarcity factors or perhaps some points of difference which makes a particular property stand out when compared to similar ones within the same vicinity / location:

  • Well-designed floor plans which are exciting and make good economic use of space – this quality will have a distinct advantage over floor plans which are less economical such as unusable long corridors or irregularly shaped areas which may limit its usability.
Fireplace

Unusual fireplace design

  • An apartment with an additional car space in a high demand location – there is an increasing number of suburbs close to major CBDs where street parking is becoming increasingly popular and in high demand. Visitors’ parking in apartment blocks which are well-managed are reserved strictly for visitors to avoid errant parking by owners.
  • A separate toilet and wash basin within a one bedroom apartment – most one bedroom apartments have only 1 joint bathroom and toilet.
  • A terrace house with an open plan kitchen and living areas – most terraces have long corridors with separate kitchen, dining and living areas.
  • A level backyard in a street with undulating backyards and limited private open spaces.
DW

Unusual house design

  • An interesting house design in a street where all houses have similar facade and attributes.
  • A room with a spectacular view in a street where the majority are facing a busy and noisy street front.
  • New apartments which come with modern conveniences – these facilities include reverse cycle air-conditioning, gas cooking, internet / cable TV ducting in separate media nooks, open plan living, down lighting, external secured storage on title, private and secured parking, gymnasium and pool facilities have a clear and distinct advantage over older apartments without such amenities.
  • “Hidden” features which may not be obvious to most people or potential to add significant value – this may include an option to knock down walls and create an interesting floor plan or open concept, adding an entertainment deck that flows from internal living spaces or renovation and extensions which significantly upgrade living areas and hence create value.
Modern open kitchen concept

Modern open kitchen concept

The above examples are just some of so many “scarcity factors” which set a particular property apart from others which are more “normal” and “usual”. The important criteria is the feature must be fairly unique, interesting, scarce AND in great demand from both owners and tenants alike.

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Property outlook July 2010 ~ should you believe the hype?

Lavender Bay, Sydney

Lavender Bay, Sydney

The outlook of property markets has changed recently from the heady days of mid 2009 to early 2010 where on average, property prices across major capital cities in Australia increased by a whopping 16% to the year ended March 2010. There have been mixed news in the media about a property bubble in Australia, the continued strong performance of the economy where inflation is creeping beyond the comfort levels of the Reserve Bank, record low unemployment rates, healthy export figures, weakening consumer sentiment, rising rents, low housing stocks and strong immigration numbers and most recently, a change in leadership in the government. What does all this mean to the property market in Australia?

Here are some key messages from the media and property experts recently:

  • Recent auction rates in July are falling, particularly in the major property markets of Sydney and Melbourne. Therefore, the property market is faltering after such a strong performance last year.
  • There is a property bubble that has been brewing. This view is further compounded by Jeremy Grantham, a US investor that a property crash in Australia is imminent.
  • Consumer sentiment has dampened in recent months due to the successive rise in interest rates.
  • The Australian economy depends largely on the economy of China, which may slow due to the European crisis and poor performance of the US economy.
  • Recent interest rate rises have put a strain on households and housing affordability.

Before we dive into what this all means for the property market, here are some facts and some of my personal perspectives:

  • The strong performance of the residential property market in Australia over 2009 and early 2010 was largely due to a number of key factors –  record low interest rates, significant government stimulus, First Home Owner’s Grant and pent-up demand from investors holding back from late 2008 to mid 2009 as a result of the GFC.
  • Current interest rates are slightly below 15-year levels. Therefore, further rises over the next 6 – 12 months in addition to the last 6 rate rises should not come as a complete surprise.
  • Property prices move in cycles. The significant price rise over the last 12 months will need a “breather”. This is also not to imply that prices will crash as there is no credible basis for this outlook at this point in time. However, as strong as the current Australian economy is performing, we sometimes forget Australia as part of a global economy that depends upon what happens to the rest of the world.
  • Statistics quoted by the media and “property experts” are general in nature and as such, should only be taken as a general guide. Indeed, there have been suburbs which have experienced stagnant prices and even price falls over the last 12 months and vacancy rates in certain suburbs are up to 8%.
  • There is a shortage of properties in and around well-located suburbs in and around Australian capital cities.
  • There is strong migration of skilled immigrants into Australia each year.
  • Organic growth of the Australian population is very strong and there are significant changes in demographics such as an increasing number of people living alone and smaller households, retirement of the baby-boomers, people working from home, casual employment, women delaying having a baby.
  • Unemployment in Australia is at record lows compared to other developed countries around the world.
  • Auction rates account for a mere 10% of property sales in Australia. Whilst it is an indicative factor, investors need to look at individual suburbs, the type of property and the time of the year when property are sold. Auctions account for less than 1% in certain suburbs and winter is generally a slower market than spring and summer.

What should you, as a property investor, do?

First and foremost, as an investor, one needs to understand there is more than one property cycle at any given time.

Each state within Australia has its own property market moving in their own respective cycles. In major capital cities, there are also minor cycles within each suburb which may or may not move according to the general statistics of house prices, auction rates, investor sentiment and number of new buildings quoted by the “experts” and the media which are predicated upon very general terms across the entire country.

In reality, there is the “real property cycle” and the “perceived property cycle”. These two cycles are identical except in property markets, perception generally lags reality, that is, the general crowd is always late in reacting to changes in the market.

Generally, properties located in suburbs with good public transport and amenities with easy access to the CBD will continue to be in demand over the medium to long term. It is not enough to say that good locations will always be good investments. One need to zero in on which capital city that is having the positive credentials of a strong state economy, good infrastructure and strong demand. Then, one would examine the well located suburbs within that capital city, further identifying good streets within that particular suburb which satisfies the criteria of strong demand from BOTH investors and owner-occupiers alike. Thereafter, I would further zero into the better side of a particular street and then to the type of property with the element of scarcity and/or “hidden potential” to value add.

Once the right property is identified, only then the element of price comes into play. Further research to ensure fair market value by comparing recent sales up to last 6 months will minimise the risk of buying the wrong property  at the wrong time in the wrong location at the wrong price.

Most analysts and observers agree that property prices will soften over the next 6 to 12 months, that is, general price growth will moderate to more modest figures. Having said that perception lags reality, the strategy is to obviously decide what is your own perspective right now and act, react or do nothing before the entire crowd does.

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Dee Why Grand ~ Luxury northern beaches apartments set for grand opening

IMG_0112

Dee Why Grand - final stages of construction

Dee Why Grand is the latest development of luxury apartments at the corner of Pittwater road and Sturdee Parade in Dee Why.

The majority of the apartments in Dee Why Grand faces the north and east aspects which look towards the ocean. As such, the apartments have a bright and airy feel. Other features include European kitchen appliances, quality fittings, 2.7m ceilings around living areas and good sized balconies and courtyards. Facilities include a gymnasium, indoor swimming pool and 3,000 sqm of private landscaped gardens. Location wise, Dee Why Grand is merely 800m from Dee Why beach and its cafe and restaurant strip.

Launched in early 2009, the 161-apartment development is due for completion this month where, according to selling agent Boris Slunsky of CB Richard Ellis, 140 apartments have now been sold. It consists of an integrated development of 1, 2 and 3 bedroom apartments with  34 retail and commercial outlets which include Coles, Harris Farm Markets and a Liquor Superstore. It will also be the site for the refurbishment of the iconic Dee Why Hotel with a brand new bar and restaurant. These shops will commence business on 29 July 2010 whilst the apartments are targeted to settle around mid to end of August 2010. The shops, cafes, restaurants and commercial outlets are an obvious convenience to residents of the development.

DeeWhyGrandPlaza

Dee Why Grand - artist's impression

Hitherto, the suburb of Dee Why has been more “low-key” than its neighbouring suburbs of Manly, Seaforth and Balgowlah Heights where property prices are relatively higher although all the suburbs share similar attributes of a beach and surf lifestyle with its own cafe and restaurant strips and local shops.

price comparison of houses and units in northern beaches and its surrounding suburbs appear to indicate that Dee Why has been relatively affordable.

Dee Why Grand is an important development to the suburb as it is envisaged to transform the retail and commercial precinct along Pittwater road into a vibrant business hub just as Pacific Square Shopping Centre and its apartments have since transformed the entire facade of Maroubra junction.

Rental estimates provided by James Brown, the managing director of Village Property estate agents are as follows:

1 Bedroom + courtyard apartments: $400 – $420 per week.

1 Bedroom apartments: $430 – $460 per week.

1 Bedroom apartments with study: $460 – $500 per week.

2 Bedroom apartments: $590 – $650 per week.

2 Bedroom apartments with study: $675 – $725 per week.

3 Bedroom apartments: $750 – $800 per week.

Vital statistics

Dee Why Median price $ Weekly advertised median rent $ Gross yield $ 3-year growth % 5-year growth % Average annual growth %
Apartment 425,000 400 4.9 11.1 11.3 5.29
House 838,000 630 3.9 12.8 2.2 7.4

Source: Your Investment Property, March 2010

~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

How it’s calculated:

Median price: Median price for the 12 months to November 2009

Average annual growth: Average percentage change over the past 10 years as a per annum figure

3 and 5-year growth: Median price percentage change over the past 3 and 5 years to November 2009

Weekly median advertised rent: Median price of rental listings for the 12 months to November 2009

Gross yield: Estimated rental return, based on advertised rent to median price

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