Home' API Magazine : February 2014 Contents 84
API FEBRUARY 2014
FEBRUARY 2014 API
¿ STEADY GROWTH
Williams describes the overall
Drummoyne market as healthy with some
“There has definitely been a healthy 10
per cent plus increase in that bottom end
of the market in terms of value and now
we’re starting to see that flow into the
upper to middle markets.”
Williams suggests that those looking to
buy in Drummoyne try to avoid the two
main roads that run through the suburb.
“I think it’s preferable not to buy
on the main road, however people
make the decision because they can’t
afford anywhere else and they want
“Most people aspire to be in a quieter
street but if they’re focused on being in
this locality and their budgets don’t meet
it, then they might be prepared to buy on
a main road.
Building a nest egg
Sydney couple Jenny and Peter Gardner
have joined a host of other investors
choosing to take advantage of their self-
managed superannuation fund (SMSF) to
The couple are the proud owners of
a two-bedroom, one-bathroom unit in
Drummoyne bringing in $550 a week rent.
A young professional couple rent the
unit, which is situated on the second floor
of the apartment complex and boasts
impressive water views.
Jenny says she and husband Peter chose
the Drummoyne location to purchase
an investment property because they
knew there was good potential for capital
growth and the property provided them
with a number of options to consider in
the years ahead.
“We actually live in a house in the same
street as the unit, but my long-term
dream is to move down to the northern
beaches,” Jenny admits.
“We could keep the unit and use it as an
inner city apartment for ourselves in the
coming years. But we have two daughters
aged 22 and 21, so whether we keep it as
an investment for them by selling it and
getting a deposit down the track, or if
we need it for our super we can keep the
rental paying into our SMSF.
“It’s there for a few purposes actually.
And knowing the street and knowing
the area we were confident it was a
Jenny says despite the large purchase
price and a weekly rental that isn’t as
much as they had originally hoped for, she
believes the location is a proven hotspot
for impressive capital gains.
“We admit we probably paid top dollar
for it ($760,000) but it’s only going to
appreciate. I looked at units in that area
about six years ago, one below the unit
where we just purchased, and they were
selling for $430,000.
“It’s rented to a couple with double
Names: Jenny and
Strategy: Buy and hold
income and no kids and we probably didn’t
get what we expected for the rental, but
that money does go straight back to our
SMSF, so it’s not costing us anything at
Jenny says ideally the couple’s intention
is to hold the property as a rental for as
long as possible.
“It’s a long-term investment. We plan to
hang onto it. I’m 55. So we want to hang
onto it for at least 10 years.
“My husband and I had several super
funds between us that we were talking
about merging together for quite some
time but hadn’t got around to it.
“The super funds have been performing
quite well of late. Although, with the GFC
they all dropped and we were horrified
when we looked at our super a few years
back. When we looked at them again
recently we actually thought ‘no, they’re
doing quite well now’.
“We decided while they were up we
should merge them together and see
collectively what we had. We thought ‘we
could actually do something substantial
with that money’.
“Peter is 63 so we decided there has to
be a better way to manage your super
and when we put it together it came to
enough for us to be able to do something
“Peter looked at the unit briefly and
decided it was a very good option. It
has views of the water and we know the
location has shops, transport, schools,
facilities and a sailing club so it’s in a good
spot,” she says.
“And if ever the girls get married or move
out, or just needed somewhere to be close,
it’s there for them.”
“We have two main thoroughfares in
Drummoyne – Victoria Road and also
Lyons Road. These are our busiest roads
but the rest of the area is pretty good.
“We have some wider tree-lined streets
that are nice and would be more suited
to homebuyers. We also have streets in
Drummoyne that have water views and
Williams says development in the
suburb has essentially ceased with most
of the industrial sites now developed.
A spokeswoman for City of Canada Bay
council says a slow population growth
has resulted in very tightly held property.
“Population only grew by 944 between
2006 and 2011. It’s a tightly held area
with traditional homes and little or no
land for major developments such as
apartments,” she says.
Despite the limited availability of stock,
Williams says due to the close proximity
to the CBD more people are looking at
Drummoyne to avoid the frustrations of
travelling from further afield for work.
“Given we’re only six kilometres from
the city and we have excellent bus and
ferry services more people are looking
here because of access to the city and
the harbour, combined with the village
and café lifestyle.”
Williams has found a lot of buyers in the
area are empty nesters whose children
have grown up and have moved due to
He says in his experience the majority
of sales in Drummoyne have been mostly
to owner-occupiers, however recently
more investors have started to come
back into the market.
His agency is also seeing more
people buying property in Drummoyne
“That is really very topical right now.
There has definitely been an increase in
people buying property through super,”
¿ THE LIFESTYLE FACTOR
Will Hosking is a property adviser with
Propell National Valuers and says due
to the suburb sitting on the peninsula
between Iron Cove and Five Dock Bay, it’s
surrounded by water on three sides.
“Properties that have water or city views
or potential for water views with future
development (such as adding a second
storey) will always perform well,” he says.
“There has been the emergence of strata
units along some waterfront pockets,
along with a small amount of newly built
freestanding residences (knockdown
THE STATES // NSW
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