DAVOREN PARK SA

My opinion is in line with your comments. The north of SA is REALLY HOT!!!! Up until the last few years the common comment that "nothing happens north of gepps cross" was true except for crime! I have lived all up the eastern seaboard and moved to SA in 2003 right before the boom hit here. I built in a new area in blakeview, not down near main north road but basically a stones throw from one tree hill (very nice). Where we are the houses are on average $300k plus with many two storey places fetching above 400k, but its still only 5-10 minutes to the MOST dodgy parts of elizabeth and daveron park.. As for daveron park, there is a lot of bogans there to put it simply, but the govt has launched a 10year $15billion program to weed out the areaas known as the "bronx" and redevelop the land. Ive heard rumours that the govt are even buying back SAHT homes for at a loss (to the them) so they can demolish as many as possible and sell the land to private investors to build new estates. BAsically the govenrment has finally worked out that areas with a high concentration of low rental properties inevitably go downthe tubes in terms of the whole area, which is what daveron park was for a long time. Really, on the upside, you cant buy an empty block of land anywhere in the north for under $80k so things are really going from strenght to strenght.

My prediction is that in 10yrs time, the north will be as unaffordable as sydneys west is now. And even wayout places like port wakefiled will start to bring in some more money. As for that place you are looking at, there are some REALLY dodgy bogans there and i wouldnt even be consdiering renting anywhere without landlords insurance.

From my end, i am doing a subdevelopment of 18 homes in murray bridge as i think also, that this area is going ahead in leaps and bounds, the same reason AVJEnnings has realeased a major new estate upthere and loads of small time developers are getting a piece of the action. The upside is for me that 4 bed homes up there are selling at anythign from $270k to $380k while land is still pretty cheap, ie: under 100k.

If you can get a good property manager, go for it. If you cant trust your property manager then i wouldnt. Make sure you go through a property manager anyway, otherwise if you have a tenant from hell, you will be a very unhappy investor! I woudl look around abit more, and see what else is availble for a similar price. That is good rent for the purchase price, but if you get a tenant that doesnt pay then good rent is worthless! I would however steer away from semi-detached also, as these dont really increase in value as much as free standing places do.

To summairse, if you wanted to buy that same place in 2000, you would have got it for $30000. Now that is a steal in anyones money. If its $139000 now, and you can maintain it for 10 years, it will be worth a lot more then.

hope I have been helpful.

The problem with semi detached is you really don't have much room to move in terms of development. The area in Davoren Park you are talking about is pretty bad. Unmowed lawns, car bodies on front lawns etc….but good returns.

I went for a drive through there about 2 weeks ago to see what the homes look like. As i turned down a street I found myself in a brand new street with all brand new homes built on it. Some were still unfinished. These were literally one street over from the old run down homes. Behind these new homes was a train line so I drove around to the other side which was Elizabeth West and there were quite a few nice homes there. Totally different looking suburb to Davoren Park.

At the end of the day though I can't see a downside to buying there. Good Luck

Hi fingercrossed i believe Elizabeth and Davoren Park are areas to look at for capital growth due to the fact that they have pretty much nowhere to go but up. Here in sydney outer west some of the "bronx" suburbs 2-3 years ago 3 bdr were around $120-130k but as i looked recently aroung the same kind of houses i guess are going for around high 100k – low 200k so i guess low socio-economic areas cannot be cancelled from the CG list. Have you read the August issuse of Australian Property Investors in this issue it questioned and showed evidence why some lower market suburbs "ugly duckings" where either out running or going dollar for dollar against the CG of other Prime suburbs.  But yeah when in areas like this i would not leave landlord insurance out.