NSW real estate: Blacktown the top suburb for Sydney investors

Exclusive data reveals big returns and high rental yield in this property investor’s dream Sydney suburb. Check out our full analysis and find out why you can’t wait to get onboard.

Huge potential for more income through granny flats and snapping up houses on big blocks have driven buyers to make Blacktown Sydney’s top suburb for investors.

Data from real estate digital advertising company REA, which operates Australia’s leading property websites, has revealed that 482 houses were sold to investors in Blacktown over the past year, with a rental yield of 2.9 per cent - the gap between overall costs of the home and how much the owner pockets in rent.

The increasingly popular suburb has experienced a 3.3 per cent growth in rental demand annually and an incredible 109.9 per cent growth in median house prices in the past decade.

McGrath Blacktown director Kon Stathopoulos.

Sandip Patel (left) settled on an investment property at 152 Flushcombe Rd, Blacktown, in August.

McGrath Blacktown director, Kon Stathopoulos, said investors were drawn to the suburb’s hospital, shopping centres, schools and proximity to Parramatta.

“I think if you’re looking at it from a destination perspective, I believe Parramatta and Blacktown will be the inner west in the next decade and people are also seeing the growth trajectory,’’ he said.

“I think Blacktown is a gateway for first homebuyers but it’s also the gateway and opportunity for people to upsize in terms of the proportion of beds, baths, cars and in terms of land size as well.’’

Large blocks are also attracting investors, mainly from Blacktown and inner west, who can boost rental return with granny flats.

“What we’ve seen over the last 12 months with Covid and the way people live, people have wanted a shift and a change to something that’s more affordable but larger with a backyard and that’s what I call the return of suburbia,’’ Mr Stathopoulos said.

“You can go and buy a two-bedroom apartment (in the inner west) for $1.2 million

“That won’t buy you much, but you can go and buy a house in Blacktown with some spare change for the same amount of money.’’

Investor Sandip Patel recently snapped up a three-bedroom house at Flushcombe Rd, Blacktown, for $930,000, and expects to receive rental return of $450 — a weekly income he plans to consolidate by building a granny flat on the 773sq m property.

Blacktown is a suburb that appeals to Mr Patel and his wife, who own a house outright in the suburb, after they moved from Parramatta eight years ago.

How the Blacktown campus of Australian Catholic University is expected to look once completed.

“Blacktown has everything,’’ the IT project manager and father-of-two said.

“Plus we have a new university campus, so from the rental point of view it will be a good investment and the property is close to Blacktown South school, so it’s a good primary school there, and we have Blacktown boys and girls’ selective (high school).

“I looked at Toongabbie and Pendle Hill but they didn’t have any shopping or hospitals nearby so after Parramatta, Blacktown was the one suburb that had everything.’’

LJ Hooker Blacktown’s Matt Lucas has witnessed strong interest in renting homes among the suburb’s multicultural community who are drawn to granny flats.

“We find multi-generational homes there, like your house and granny flat. There’s certainly properties in high demand and we are definitely seeing some of the premiums on those homes,’’ he said.

A house with granny flat at 4 Prospect St Blacktown. Picture: realestate.com

“I do find particularly with a lot of our Indian or Chinese-background cultures where you have mum and dad living at home with you, they assist with the childcare.’’

He said Covid has failed to abate the hot investment property market.

“It’s like the tap started turning on in January and started spilling out buyers,’’ he said.

“If I go back to inquiries prior to the lockdown, it was still the busiest time I’ve seen in 20 years of my career.’’

LJ Hooker recently sold a house and granny flat for $1.05 million at Meroo St Blacktown.

The three-bedroom, one-bathroom property on 973sq m will yield a weekly rental return of $3904 a month.

Homes on big blocks, like this one at 6 Meroo St, are driving a healthy investment market in the suburb. Picture: realestate.com

At Prospect St, a three-bedroom house with a two-bedroom granny flat on a 556sq m block sold for $980,000 and expected to draw $4235 in rent each month.

The Blacktown Brain and Spinal Institute, led by neurosurgeon Dr Charlie Teo, the hospital’s redevelopment, an Australian Catholic University campus and plans to make it a sporting capital are propelling Blacktown’s infrastructure growth.

The REA data showed Blacktown’s units were ninth on the list for investors, a placing Mr Stahopoulos was “pleasantly surprised’’ about after an oversupply of units in nearby Parramatta usually placed it lower in that market.

After Blacktown the top suburbs for investors were Dee Why and Kogarah where 452 and 446 apartments were sold this year.

Kellyville, Lidcombe, Penrith, Liverpool and Umina Beach on the Central Coast rounded out the list.

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