Im pretty new to property (as you might have noticed by my spamming of new topics lately! haha) so i need some of the basics.
I want to buy an apartment / townhouse / villa in Sydney’s Inner West. How can i judge capital grown in this area in general. And more importantly, how can i pinpoint the best suburbs and streets to buy in?
I suppose my question is 2 fold… 1, does anyone have any specific advise on this area and which suburbs are set to go well over the next 5 years or so? And 2, what resources can i read up on to make my own call on the best place to buy?
Cheers
JoelTry and find out what past CG in the area has been and compare it with other relatable suburbs. If you can go back as far as 20 years, it would give you a better overall idea of the areas potential. The local council should be able to provide some good information on past performance. An educated buy in a 'well located' area should prove itself over the years as a good IP.
The best thing to do is check the data in the back of any Australian Property Investor magazine as it's quite comprehensive. There's plenty of data online too of course, although you are usually charged for this information.
Here's a list for CG suburubs Australia-wide- http://www.smartcompany.com.au/construction-and-engineering/the-top-50-growth-suburbs.html. Did find some for Sydney but at a cost of $215 etc.
I have heard that the inner west is a good place to be investing as infrastructure development, residential land re-zoning, Gov spending and population are all on the increase in years to come. Plus house prices are a bit more affordable so it would be a good place to start.
Good luck!
Regards,
Derek
I took your advise Derek and got hold of the latest API mag. I summarised the suburbs im considering, check it out: http://dl.dropbox.com/u/25529141/Inner%20West%20Growth.pdf
If you look at St Peters, it has experienced 32% Growth in the past 12 months! massive!!! So am i right to say now is not a good time to buy into St Peters?
Take Marickville on the other hand, it has had steady growth for years but no “boom” yet. Its just that one step further out from the CBD than St Peters, so would i be right in saying its a good place to buy?
Thanks for the reply Derek. Anyone else? Or is that really all home buying 101 advise this forum has to offer?
(in the file, ??? means that suburb didn’t appear in the back of API Mag.)
Look at the factors that may drive the growth in the future. Is their infrastructure spending within the area? Is it a bad area that's steadily improving? Is the population of the area on the incline?
Margaret Lomas has a great book called 20 must ask questions. It provides some good tips on pinpointing a particular area for investing within.
Cheers
Jamie
Jamie Moore | Pass Go Home Loans Pty Ltd
http://www.passgo.com.au
Email Me | Phone MeMortgage Broker assisting clients Australia wide Email: [email protected]
Always happy to help a fellow newby and share whatever info I can
Interesting you should mention Marrickville, I've been keeping my eye on the area for a while now and think it's a good place to buy, primarily for the reasons you mentioned. It does still have a bit of a stigma attached to it but, like Redfern, is slowly undergoing gentrification due to an increase in the young middle-class looking for more affordable housing that's still close to the city.
One piece of advice you'll hear again and again is to buy in the suburb next to the one that is booming. In this case, it seems Newtown and St Peters have had their time in the limelight so Marrickville should be next on the list. You're definitley on the right track with regards to the way you're thinking. Speaking of track, most of the suburbs on your list have train stations and reasonably good bus services so they will usually be in strong demand.
As Jamie mentioned, look for factors that will cause growth in the area. I noted that the Aquatic Centre has been redeveloped and there's some sort of 'waterplay' park that was recently built. Also heard there was to be another mall constructed in the area but not too sure when or where.
When I was a ceiling insulation installer (fun times!) and working in the area, I did notice that a lot of the houses were run down and could so with a good reno. I'm not sure what strategy you intend to go with but I think it would be worth looking into that method as reno's are a quick way to gain equity. Personally it's not a place I'd want to live but if the numbers stack up and the outlook seems positive, go for it!
Regards,
Derek
joel,
I own property in the inner west where I have lived for over a decade and as a keen investor I know the market pretty well here.
As with all investing is about supply demand, changing demographics, gentrification, new infra structure and proximity to services.Where and what you buy depends on your strategy budget and end goal. Focusing on capital growth is good but there a lemons in the best streets in the best suburbs. That said for cap growth the inner wset is a good place to start. If I was buying again here Id be looking at something I can add value to. If a unit I would look at an older style unit in average condition and adding equity and increasing yield by minor cosmetic renos. Suburbs I think are good long term would be Marrickville, Dulwich Hill, Summer Hill. The reason for this is these suburbs have some large scale genetrication of old industrial land soon to be developed into up market residential and mixed use development, a soon to be completed light rail line with city access, a continuing changing demographic of more young professional moving in, proximity to good schools, heavy rail, cafes etc.. As for St peters, it may be close to Newtown which is good but there is no real centre/village in St peters and it suffers from alot of aircraft noise and is generally more run down than the suburbs above.. Marrickville is not really further out, it may seem that way due to the rail corridor but in a straight line from the CBD is pretty equal to St peters but with alot more going for it. Bedsides all the things mentioned above the key to seeing growth hear is the type of people calling marrickville home. You will find under the surface a lot of artists, window galleries, underground and avanteguard venues, design studios, fashion and rag trade businesses, alternative co ops, etc etc…. If you follow history of rags to riches suburbs you will find that the art and or alternative community are the first to adopt an up and coming area. then the cafes and trendy shops follow, then followed by creative and other professionals moving in to renovate the old houses, and eventually you have the new hip suburb.
ps.
dont get hung up on capital growth statistics, they are at best unreliable… it only takes 1 mega sale (expensive house) to skew the average for the month, quarter, or even year particulary in suburbs tightly held. It also depends on even which day the measured cycle of growth starts and finishes and whos measured it, residex, APM, blah blah….markets are much more complex and can fluctuate up and down much more than stats can measure. Ie if yo buy the week after a interest rate rise you may find another micro climate of price fluctuations the stats might not pick up over a longer term of a quarter, month etc.
Thanks for the comments Event Horizon. Very helpful!
I should mention that i am looking to buy there TO LIVE! But i want to make sure that it has good growth at the same time, to set me up with some equity to invest in the years to come.
I couldn’t agree more on the “add value” concept. I have been to some real shockers in recent weeks. I’m sure you could pick one up for way below market value, drop $20k into a cosmetic reno and have yourself a nice little apartment to live in at far less than purchasing a new or recently renovated place.
Did anyone catch the top 100 edition of API mag? I was happy to see the inner went feature a few times
Hi Joel,
as per EH, there is some great property around the innerwest – you might investigate the route of the new light rail. Possibly pick up a house/unit in Leichhardt/Rozelle which will benefit from the line.
As for the stats – they are useless and at best unreliable unless you understand what is behind them. A few major unit developments is all it takes to push median prices up for one/two years then the median all of a sudden will drop 10-20% as the bulk of the sale stock is older buildings not newly built.
Got to be careful in judging CG.
as the bucket of property bought and sold keeps getting newer, this scews the data…
eg 40 year old units sell for 400k.
U beaut new units sell for 700k.
one big new super duper complex (gym, pool, shiny and new) sold will scew data.
yes the av price goes up, but not the price of actual RE.
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