Battler suburbs like East Victoria Park set to boom in 2014
BATTLER suburb East Victoria Park and trendy nearby Victoria Park have been named as two likely boom areas for 2014.
SO you didn't make the property ladder this year? Relax, there are many undiscovered suburbs with potential for double-digit growth in 2014.
House prices are rising, listings are shrinking and auction clearance rates are at record highs in Australia's largest housing market - there's no doubt it's a tough time for buyers.
But the good news is, experts agree that next year's hotspots will be more affordable and within reach of the average punter.
News.com.au has gleaned the good oil from veteran market commentators Terry Ryder and Peter Koulizos for their picks of the places to buy in 2014.
In Perth, battling East Victoria Park and its trendy "cafe lifestyle'' neighbour Victoria Park, have been named as two suburbs that are likely to surge in value.
The area, within 5km of the Perth CBD, fronts Crown Burswood, and is just a couple of kilometres from Perth's new 60,000 seat sports stadium.
Mr Ryder is a property analyst and the founder of hotspotting.com.au, a site dedicated to helping property investors find the next big thing.
He and his team takes dozens of factors into consideration - including population growth, infrastructure, town planning rules, and investment and employment opportunities.
Mr Ryder said this year cashed-up investors shaped capital city markets, with buyers busting their budgets to follow the crowd to million-dollar suburbs, particularly Sydney.
Savvier buyers would have invested in these areas at least a year earlier, Mr Ryder said.
"Buyers have been favouring the upper end of the market in capital cities and I think you will see less of that and smarter buying spread across more affordable middle-ring suburbs, " Mr Ryder said.
"They will be more rational and targeted in their purchasing, rather than having a herd mentality."
Where to buy in Sydney
In NSW, Western Sydney will be the next property powerhouse, Mr Ryder predicts.
Despite having unfashionable reputations due to higher than average crime rates, distance from the CBD, swathes of unattractive McMansions and fibro cottages, Western Sydney suburbs like Liverpool and Blacktown are in transition primarily because of investments in infrastructure, job creation initiatives, new residential developments, relaxing of town planning rules on extensions and more affordable properties.
Mr Ryder points to Blacktown as the capital city hotspot in 2014.
The suburb is still in reach for the average buyer, with a median house price of $430,00, which is very affordable for Sydney where the average median house price is $640,000.
"I believe you will see a lot of buying activity in Blacktown, Liverpool, Cabramatta and Rouse Hill," Mr Ryder says.
Melbourne
In Australia's second largest housing market, Mr Ryder tips the battler Melbourne suburb of Sunshine, on the back of its affordability, transport infrastructure and new planning strategy.
Sunshine is to become the key growth centre in Melbourne's west, with the new metropolitan planning strategy to encourage huge government and private-sector investment in the former industrial heartland. The suburb's median house price for 2013 is $400,000.
Elsewhere, Frankston, Epping and affordable Bayside suburbs are Ryders next picks for Melbourne buyers.
Brisbane
In Brisbane, it's all about Kelvin Grove, where rental returns are averaging around the 7 per cent mark.
The suburb has already been gentrified but Mr Ryder believes there's still room for strong capital growth.
"Kelvin Grove is Brisbane's infrastructure central with a uni campus, major schools a cross-city tunnel and bus links to the airport," Mr Ryder said.
Ryder is also enthusiastic about Toowong in Brisbane's inner-west.
"Toowong is lovely area and is being targeting by a lot of people working in the mines because it is close to the city and the tunnel airport link."
Buyers should also consider the Redcliffe Peninsula due to the affordable homes, lifestyle features and transport infrastructure, he said.
The median house price in Redcliffe this year was $340,000.
Don't overlook the regionals
Mr Ryder says many regional areas have prospects for transformation on the back of industry activity and government activity.
He recommend Albury Wodonga on the NSW/Victorian border, Bendigo in Victoria, Dubbo in NSW, Toowoomba and Ipswich in Qld and the Kwinana precinct in Western Australia.
"In regional Australia, selected cities and towns have done very well this year, including a few where annual growth has topped 20 per cent, among them Miles and Cloncurry in Queensland and Narrabri in NSW."
Fellow property watcher Peter Koulizos said buyers should be aiming for areas with short-to-medium term double-digit growth and rental yields of at least 5 per cent for houses and 6 per cent for units. His hot spot projections are mostly areas which have already been discovered.
Mr Koulizos explains that this is because these areas are so popular with buyers that there is still room for extensive growth.
"It can take years for suburbs to gentrify and my picks are those that are still going through that transition, regardless are whether they are already popular," Mr Koulizos said.
Illustrating the point, the real estate author wrote a book a few year ago on Australia's 20 hotpots and says 19 of them will reappear in the books the next addition."
He suggest buyers who can't afford these suburbs to look for locations slightly beyond which are going through the same transition.
Unlike Mr Ryder, Peter Koulizos doesn't have Western Sydney on his favourite's list, saying he believes there are better growth prospects closer to the city.
"It's best to buy a unit or smaller house in a great location than a larger more expensive house in a less appealing suburb or street because the location is what you cant change. "
Peter's picks for 2014
Melbourne
Coburg
Flemington
Footscray
Sydney
Ashfield
Darlington
Marrickville
Enmore
Brisbane
Chermside
Redcliffe
Albion
Perth
East Victoria Park
Victoria Park
Adelaide
Thebarton
Torrensville
Port Noarlunga
Darwin
Millner
Hobart
South Hobart
Battery Point
ACT
Braddon
Narrabundah