Complex quality is significant factor for Paddington investment's: HTW residential
Paddington is well regarded as a result of it being a well-preserved conservation area for Victorian architecture which is in demand and a lack of supply, according to a recent Herron Todd White (HTW) residential report.
The valuation firm took a look at the way to a blue-chip address at an affordable price across the nation.
It suggests close proximity to quality schools, the CBD and Bondi Junction only broadens the appeal of Paddington.
The median house price in Paddington for 2018 was $2.31 million, with the median unit price coming in at $915,000, according to CoreLogic data.
A recent sale at just under the median price was 32 Napier Street (pictured in title) which sold in January for $2.13 million. The property is a renovated Victorian terrace with three bedrooms, two bathrooms and rear single carport on a 158 square metre lot.
At the unit median price, 1/56 Ormond Street, an updated, 68 square metre, two-bedroom, one-bathroom Art Deco unit with no parking, sold in January for $915,000.
"Looking at cheaper or entry level options, units provide the best option," says the HTW valuer.
An original 1970s, 43 square metre, one-bedroom, one-bathroom unit at 206/176 Glenmore Road (pictured below) sold in January for $617,500. The unit did have a car space although you are compromising on size, condition and the period appeal that other properties in the area provide.
Another example is that of 29/8 Bennetts Grove Avenue (pictured below) which sold for $880,000 in February. It is a split-level two-bedroom, one-bathroom unit with a nice outlook and parking. Surprisingly, it’s in liveable condition, although ideally you would want to update.
"With this unit you are again forgoing the period appeal and size for a two-bedroom unit, with the living area around 60 square metres," says the valuer.
"Are the compromises worth it? Absolutely, if you want to be in the heart of the action. You’re buying into a premium and highly liveable suburb for well under a million dollars, with the added bonus of a parking space. Even a basic renovation would greatly increase the appeal of these units."
The report notes when it comes to units, the quality of the complex makes a big difference. Unit blocks of owner- occupiers are typically more well maintained and have facilities such as pools, gyms, visitor parking and concierge. Often period blocks with a high number of owner-occupiers are well preserved, further enhancing their value.
"The dwelling market within the inner city is largely dominated by owner-occupiers, however some investor activity does occur. Those properties targeted by investors tend to be on smaller parcels of land and often forgo parking. If they are terrace properties they commonly have a narrower frontage.
"As one would expect, investors target lower maintenance, higher yielding properties, often leaving out extras such as common amenities, larger yard, parking or updates to improve their overall return on investment."