NSW property market: Leonay one of the best Sydney suburbs for property investors

A new study has revealed the top 20 locations for property investors in Sydney. See the full list and find out which western Sydney suburbs made the cut.

Leonay in greater western Sydney is one of the best bang for buck suburbs for property investors, a new report shows.

The Make Your Move report, powered with PropTrack data, analysed price movements, rents, yields and tenant demand in every suburb in the country to determine the “best” locations for investing.

Suburbs deemed favourable for investors had higher rental returns, soaring demand from tenants and a history of strong growth in local property values.

Real estate agent Paul Wallace has lived in Leonay his whole life — he went to Leonay Public School where he first met his wife and where she now works as a teacher.

Speaking to The Penrith Press, Mr Wallace said Leonay had a lot of potential for property investors because it was flanked by the river, the Blue Mountains and a golf course, so it has limited room for expansion and would never be as densely populated as other western Sydney suburbs.

Leonay is one of the best Sydney suburbs for property investors.

“There are two ways into Leonay and two ways out of it, so this suburb has a real village feel to it,” Mr Wallace said.

“But there’s also easy access to the M4 and the ever-improving infrastructure in western Sydney will make it a more exclusive suburb going forward.”

Paul Wallace is a real estate agent who has lived in Leonay his entire life. Picture: Allan Whitbread.

Mr Wallace said while Leonay used to be an older area, home to many seniors, there is an increasing number of people who grew up in the area returning there to raise their families.

“People are moving back to Leonay because it’s a tight knit community and it has that sense of belonging — that sense of community within a small defined space.”

Local real estate agent Gizzelle Powell also said Leonay’s location was a large factor behind its popularity among property investors.

“This suburb is for everyone whether you are a young family looking with an active life or a senior looking to get away from it all,” Ms Powell said. “Just take a stroll (down) Linksview Ave and you can see it for yourself.”

Gizzelle Powell.

According to the Make Your Move report, plummeting housing demand and an explosion in rents have created a window of opportunity for property investors to get cheaper Sydney properties with lower holding costs.

And the most fertile hunting grounds to find these deals are in south west Sydney, the Central Coast and the Blacktown region.

Based on the report’s metrics, Carnes Hill and West Hoxton, in the Liverpool region, Leonay in the Penrith region, and Camden, Catherine Field and Glen Alpine, in the outer southwest, are among the other top ranking suburbs for house buyers.

PropTrack economist Angus Moore said the Central Coast and parts of Sydney’s west dominated the rankings because, compared to the city average, rents were much higher relative to home prices.

Property prices were also continuing to grow in some of these suburbs, despite the recent market downturn, due to an influx of “lifestyle” buyers wanting extra space, Mr Moore said.

The economist noted investors appeared to be capitalising on some of the improved conditions.

“Investment activity has been rising,” Mr Moore said. “Vacancies are now much less of a risk than they were in the early pandemic.

“At that time, rents were dropping in some areas, particularly the inner city, and some investors were selling properties and getting out of the market.”

Nathan Birch, the founder of buyer’s agency Binvested and the owner of more than 200 properties, said the “softer housing market” made it an ideal time to buy an investment property.

“Fear is everywhere because rates are rising. This is the time to get the best deals,” he said, adding that it was a similar climate to 2008, when the global financial crisis was spooking buyers.

Prices had fallen across most suburbs during that period but the market quickly recovered in 2009 and the buyers who purchased during the slump got quick equity growth, Mr Birch said.

He noted recent rises in rents – Sydney house rents climbed 20 per cent over the past year – were well above recent interest rate hikes.

“Mortgage costs have gone up, but so have rents. You have to know where to look, but there are opportunities to get properties where the rent is more than the (repayments),” Mr Birch said.