Hi
I’m trying to pull together a property investment plan for the next 5 years and as part of that I’m trying to identify areas in Australia that should produce 12%+ growth per annum over that period. I can potentially spend up to about $500k on each asset.
I know a lot of areas are performing well now but will that continue???
My preliminary thoughts about areas that may fall into that category are:
Adelaide + selected areas in SA – ie Wine producing areas, Victor Harbour, etc. I think in general SA is in good shape with mining etc.
North Coast/Byron Bay NSW – Limited land supply / constant demand
Sunshine Coast Qld – Always popular
Inner Ring Sydney (only issue is bucks required)I’ll love to get the thoughts of others and some reasoning behind areas of choice.
Thanks
TheBishHave a squizz at the AFR from the 28th Dec – good guide to all states markets including compounded annual growth rates. The questions remain: how much of this growth is sustainable? Now that the other capitals have caught up with syd/melb will the great divide still exist or will they go into decline or overtake these two? What is affordable going to be in a couple of years?
Melbourne is really interesting as it looks to have gone from no growth to 10+% growth generally in one year.
Probably still opportunities but does this reflect the huge number of investors now in the market – as soon as people even think there is going to be growth they buy buy buy.
Sydney appears to be the capital city which has the greatest potential in the next few years. Brisbane, Sunshine Coast, Melbourne and Adelaide are too hot at the moment. I've got no idea how to pick good regional areas. Developers have done their research well before we find out what's going on in these areas. By the time we find out what's going, the market has already bolted.
I'd advise you to concentrate on a few areas and get to know them well. I live in Brisbane and it's hard enough getting to know 6 suburbs in one city let alone 6 areas in one country. Each city has got its different markets. For example inner suburbs of Sydney is still doing well while the western suburbs is going backwards. Most of Brisbane is doing well with riverfront suburbs going up at a much higher rate.
Adelaide appears to have good upside. CBD apartments are still affordable and yields are good. The regional cities close to Roxby Downs will benefit if BHP-B expand the mine. House prices in areas like Port Augusta and Port Pirie are coming from a low base, so it is likely that double digit returns will continue. Defense and education (huge intake of international students from Asia) will also add demand pressures for housing, and therefore increases in rents.
Hi,
I am now looking at Morayfeild and Surfers Paradise. I am currently in the process on reasearching the forcasts for the Surfers Paradise areas. Particuarly small one bedroom appartments with water veiws. There are still some available under 400k. They have really impressve yeilds also. One I have come accross is 100m from the beach with water views @ 365k renting for $310 per week. With 20,000 new people forcast to stream to the Gold Coast in the next 12 months water veiw investments under 450k will have to disapear wont they?
My problem is (A good problem to have) I purchased a IP in Elwood close to Melbourne back in July. I got it for what I estimate to be about $20,000 under market value. Looking at what is for sale now in the area of simmalar quality I beleive it has appriciated approximatly 15% on the bank valuation of 335K leaving it in the 380-390k mark. Bringing me to the debate of which areas will see the best growth and wether to stick with this investment or take a quick profit and move on? My original intention was to have this property for a 5 year period with a look to off loading it at around 460-80K
I beleive Melbourne will face affordability issues which will effect price growth. I can afford to buy the Surfers Paradise appartment and hold both properties only for 6-8 months, in which case I can take a profit on the Elwood property and keep the Surfers Paradise Property for further increases in price.
Does anyone have any experiance investing in High Dencity Apartments? What kind of capital gains are available and how would they differ from your standard residential unit or house? Keeping in mind water views would be present and rental yeild is good.
Rental Yeild on the Gold Coast is also much higher than most Melbourne Suburbs although this is begining to change.
Look forward to hearing from you all.
Thanks
RickHi Rick
Couple of pieces of advice:
1. High rise apartments have small land content which will stifle growth but if it has water views then this may help (unique feature – then again plenty in SP).
2. I’m in Surfers right now – plenty of apartment building happening at the moment which will put a damper on growth going forward.
3. Any probably most important – costs associated with this type of unit (holiday related) are usually high – so do some serious research on the financials. Agents will often provide these on request.
Cheers
TheBishMy guess would be none. I don't think any "areas" of suburb-size or larger will increase by 76% over the coming 5 years. I reckon there are some areas that will spend time falling by a similar annual dollar value within that timeframe.
Could be wrong though.Cheers, F. [cowboy2]
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