Loan pre-approvals by banks can be confusing. They aren't a rubber stamp to buy whatever you want, but some buyers are being a little too cautious.
Collingwood’s shiny investment prospects a rare find
The Australian magpie – the namesake for Collingwood’s much-loved AFL football team – occupies the same small territory for its entire life.
The same is true for the human ‘magpies’ in Collingwood. Owners of Victorian workers’ cottages and double-storey terraces in the suburb will hold onto their properties for decades. This means investment-grade property in this lively neighbourhood rarely comes onto the market.
When it does, it is highly sought after. Collingwood has emerged from its long history as an industrial battler suburb to join the ranks of Melbourne’s gentrified and desirable destinations.
Smith Street on Collingwood’s western border is packed solidly with restaurants and bars offering anything from cheap noodles and pub gigs to cocktail bars and high-end restaurants.
Old industrial factories and warehouses have been converted into apartments, and developers are also meeting demand for this area with contemporary townhouses and apartment blocks.
Collingwood is walking distance – 3 km – from the CBD and provides good tram links through Smith Street (Collingwood train station is across Hoddle Street, in neighbouring Abbotsford).
Not surprisingly, Collingwood’s residents are mainly younger, independent people. But with housing commission flats at the heart of the neighbourhood, the area has retained its diversity and authenticity.
Commercial organisations are also settling in the area. Jetstar Airways has its headquarters in Collingwood. Art school LCI Melbourne recently opened a campus in the historic Foy & Gibson factory precinct, saying the move “positions our students in the heart of the most vibrant arts and design precinct in Melbourne”.
However, the neighbourhood still has its quirks. The 86 tram line is known to attract a few interesting characters, and Smith Street retains some of its seedier elements despite the proliferation of elegant new venues.
Collingwood is also vulnerable to risk from road-building efforts. Properties in the north of the suburb that were compulsorily acquired for the controversial East-West link now sit forlornly empty, facing an uncertain future. Streets adjoining Hoddle Street would be negatively affected by any future widening of this major north-south arterial road.
So, while demand for property in this area is high, Collingwood’s investment gems are rare. They sit in tiny pockets of single-fronted, two-bedroom workers’ cottages – which are some of the oldest in Melbourne. They’re found on streets that have maintained a consistent streetscape, and that are as quiet as can be expected in such a vibrant area. They are also a sufficient distance from the busy streets that comprise Collingwood’s borders.
Good-quality warehouse conversions with a point of difference could also see acceptable levels of capital growth over an extended period of time, given their wide appeal to Melburnians seeking a more metropolitan lifestyle.