Real estate analyst gives his tips for affordable suburbs that could boom
PROPERTY isn’t expensive everywhere. An industry expert has revealed where the next cheap suburbs that could boom are.
TEN affordable property markets around Australia likely to see significant gains to real estate values have been identified in a new report.
The report by Terry Ryder, a real estate adviser and founder of Hotspotting.com.au, has tipped Melbourne as the most likely city to see an affordable market turn a corner, with four parts of the city identified.
Casey City, Dandenong City, Epping and Sunshine all made the list of potential hot spots.
Queensland was the next best placed, with three parts of the sunshine state earmarked including Ipswich City, Logan City and the Redcliffe Peninsula.
NSW had two areas in the top ten, Logan City and Westmead.
The Kwinana precinct from Western Australia rounded out the list.
Mr Ryder said the key focus in finding such suburbs was new and planned infrastructure.
“Infrastructure spending is a huge generator of economic activity and jobs, and impacts both directly and indirectly on real estate,” Mr Ryder said.
“It is not a coincidence that the rise of the Sydney property market has happened at a time of big spending on new infrastructure, whereas previously Sydney had been hampered by the lack of infrastructure spending.”
He added that in the right circumstances a battler suburb could outperform blue-chip real estate investment areas.
“In most of our major cities, the more affordable areas tend to have better capital growth rates long-term than the so-called “prime” suburbs,” Mr Ryder said.
“Sydney is the only city where the millionaire suburbs challenge the cheaper areas on percentage growth rates.”
Mr Ryder said buying in a “cheapie” or “ugly duckling” suburb could provide benefits in the short term with higher rental yields, while a well selected suburb may yield significant capital growth in the future.
Here is a snapshot of the report:
VICTORIA
With four locations earmarked, Victoria’s prospects are the strongest in the report — despite recent announcements of job losses across the state.
“The loss of manufacturing jobs, which is bad news for the families directly affected, do not overly impact on the overall state economy because this is balanced by growth in other sectors,” Mr Ryder said.
“Construction is one key area of growth in Melbourne and Victoria, balancing the downturn in manufacturing.”
And many of the areas tipped in the report are among Melbourne’s growth areas, with new transport and retail infrastructure, as well as housing development ongoing.
Among the suburbs noted in the report was Epping with a $372,000 median house price, according to RP Data figures.
QUEENSLAND
Ipswich is one of the main areas identified in the report for Queensland thanks to multi-billion dollar upgrades to transport and local infrastructure and an RAAF base expansion.
Suburbs like Collingwood Park and North Ipswich were on the Hotspotting.com.au list
They joined Beenleigh in the Logan City area, as well as Margate on the Redcliffe Peninsula.
Mr Ryder said there were a range of key points to focus on when looking within the suburbs.
“The ideal affordable suburb will have commuter train links, medical and education facilities, good shopping, easy access to road networks — and new spending on infrastructure under way or in planning,” he said.
NSW
The top of the list for NSW was the Liverpool City area, with a local hospital revamp and flow on benefits of the recently announced Badgerys Creek airport, underpinning its presence on the list.
The area has also been popular with first homebuyers in recent years with the Busby median house price of $390,000 among the most affordable in Sydney.
Westmead, 21km from the Sydney CBD, was another area tipped for growth thanks to rail transport to the city and significant employers in the education and health sector in the area.
Median prices for units in Wentworthville are as low as $411,250, affordable by Sydney standards.
WA
The Kwinana precinct, including suburbs such as Medina and Bertram were among the nominated areas of Western Australia.
The area, about 38km from Perth, got the nod thanks to low house prices and employment opportunities.
Bertram was at the pricier end with a $423,750 median house price, according to RP Data figures.
Meanwhile Medina houses have a median price of just $275,000.
