Jonathan Preston bought in Mount Druitt because he believes the area is on the cusp of social change – but it hasn’t all been smooth sailing.
“The interior of my second investment property in Tregear is horrific, or so I’ve been told. I wouldn’t know, because almost two years after I purchased the place I still haven’t looked inside. I had every intention of inspecting the property before purchasing, but things just didn’t go to plan.
I’d heard the property was about to go to sale and, having already purchased two properties in the Mount Druitt area, I knew it was the perfect fit for my investment strategy. I’m targeting properties in Sydney’s west partly because of their comparatively low entry price, but more so because I know that in 20 years’ time the area will be an entirely different place.
The agent was busy and the tenant wasn’t being very cooperative. At one point the agent told me to go to the property by myself, and that the tenant would let me in and show me around. When I turned up, they wouldn’t even open the door for me.
It sounds like a risky situation – buying without knowing the full extent of what you’re getting yourself into. But I suppose that’s what property investment is about, and I knew that I had to have it. I thought that even if it was a complete mess inside, I had to take the risk even if I needed to entirely renovate the whole thing. It turns out that at $210,000, it was an absolute steal.
According to my current calculations, the property – a three-bedroom villa with garden – is worth around $370,000. That’s capital growth of about $160,000 in less than 24 months. Some people might say that this is a reflection of the frenzied state of buying in Sydney at the moment, but I think it has more to do with where the suburb is headed.
Based on the current population growth of Sydney, in 10 to 20 years people will think nothing of a 90-minute commute to the CBD. The key factor is being able to commute to Sydney for work, something that will gain even more value if urban sprawl continues at its current rate. I don’t really care much about the kind of people who live there at the moment or how bad the suburb’s reputation is, because I believe it’s going to undergo a transition in the same vein as suburbs like Redfern have.
That same uncooperative tenant who was renting the place when I bought it is still living there. Based on what I’ve been told about the interior of this place, I’m happy to let them keep renting it at the moment. They’re paying a honeymoon rate of rent, only $250 a week for a three-bedroom place, but that figure is based on the fact that it needs to be renovated.
I think they’ve been in there for a very long time, so I’m not trying to rush them out. But eventually I’m going to have to do a renovation and then increase the rent, because the market rent is much higher now. Maybe then I’ll get to see how bad that interior is.”