Many Melbourne developers not building the right type of new housing: Monique Sasson Wakelin

Melbourne property investment adviser Monique Sasson Wakelin has questioned whether property developers are building the right type of new homes while encouraging investors to focus on buying in “blue-chip” areas.

Speaking recently to Hilary Harper on ABC Melbourne radio, Sasson Wakelin agreed there was a need for new housing due to the housing shortage identified by the ABS among others. Sasson Wakelin also concurred with Harper's observation  that new housing developments appear to be popping up all the time.

But she says the “$64 million question” is whether these new houses are being pitched and are consistent with what people are telling statutory bodies is the type of housing that is needed.

“Some of the time the answer is 'yes', a lot of the time the answer is 'no',” she says.

Sasson Wakelin says some of the new housing is developer-driven and is based on “inductive reasoning” (flawed interpretations of the what the market wants) rather than “deductive reasoning” (based on what is actually being observed in the market).

She also examined the issue of developers of high-rise apartments that no longer include a car space as part of the property offering.

“Developers are foregoing car spaces on a fairly large scale,” she says.

“Reading between the lines, it is dead money for developers, they are not getting a return out of it.”

However, she says a car space really provides additional storage space.

“All you need is a little roller door on your car space and you have additional storage.”

She says that on resale having a car space or extra storage space can add up to $30,000 to the realisation value of an asset.

Looking at the investment market as a whole, Sasson Wakelin advises property investors to stick with “blue-chip” suburbs that have demonstrated their relative resilience in the past.

At a time when the market takes a “breather” Wakelin says: “You don’t speculate, you don’t take a bit of plunge – you focus on blue-chip areas”.

Larry Schlesinger

Larry Schlesinger

Larry Schlesinger was a property writer at Property Observer


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