Is St Marys / Blacktown in Sydney good places to invest?

My comments are directed more towards St marys, Willmot, Dharruk and those surrounding areas ( Blacktown is ok)

Experts been saying the area is going to grow for the last 5 years, but most place will grow in 5 years time ( how much depends on your expectation) …nothing new.

Recently there has been more hype in the media because it’s one of the few places that actually HAVEN’T gone up, compared to it’s counter part surrounding suburbs …so hence rental yield is a lot more attractive, doesn’t mean it will have CG though.

Reason why some BA sells this area so heavily is because it makes the client ” happy” as they can see instant return…recommending an area with higher chance of good CG is not something a lot of clients will be happy with as they can see the return especially if it’s costing them quite a bit to hold .

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Do i know the blacktown area? i wont say im a expert…but as an active investor of both CG and Rental yield property in Sydney + i live 20-30 min away from Western Sydney i can say; im ok buying in black town.
But i personally would stay area from Willmot, Dharruk and those surrounding areas unless you have the patience to wait it out + aren’t scared of a few “nasty” tenants.
Don’t get me wrong; great place for cash flow, but poor CG.

Your statement about “When population grows people rent then ultimately buy in the same area.” – can apply to MOST suburb…if im going to invest into a CG area; i want to see CG within 3-5 years.

If it’s for Rental yield, then i would want a way to continue to ramp up the rent- ie dual occupancy + purchase below the market value…i expect “some” CG , like 2-3% per year + give or take 1-2 years with no growth i would be happy with. Any more i’ll take it as a bonus.

Regards
Michael

St Mary's Willmot and Dharruk ARE in Blacktown LGA. Mt Druitt subburbs make up a VERY large percentage of the Blacktrown LGA.

When I read about areas to invest in all the experts say to target areas where surrounding suburbs have gone up- buy the one nearby that hasn't gone up yet. Depends what the client is loooking for. Some people buy for yield, others buy for CG. Depends where you and your portfolio arte positioned at the time.

As I said- Mt Druitt IS in Blacktown area. I disagree with CG going nowhere. My properties have had CG and yield is great. As with any area that has a low vacancy rate, rents are increasing. Of course I want CG as well (I want it all LOL).
There are "nasty" tenants everywhere, not just Mt Druitt. It comes down to tenant selection. 
I personally like the area and has been kind to me.

As for no CG- ever hear of a guy called Nathan Birch (google him). He made his first million in buying property in Mt Druitt (after the 1999-2003 boom).

Land is the thing that goes up in value.  Houses tend to have more land.  On the other hand some tenants like low maintenance properties, which units tend to be. 

It really depends on your strategy.  If you are not keen on development (eg building another dwelling in the backyard), then is buying a house with a large backyard that doesn't fetch extra rent a good idea?  It's really up to you. 

Personally, I'm keen on land content for stuff bought in my own name or a company/trust structure.  That said, I am not prepared to put my hand in my pocket every day for years to support the extra mortgage component that big land commands, if it won't get me anywhere. 

However I've just set up a smsf (self managed super fund) and am using it to buy property.  smsfs cannot borrow cash to build, and also cannot strata/subdivide while the property is under mortgage.  So I have decided that my smsf doesn't mind so much if the backyard is big or small.  It cares only about the trifecta; good capital growth, good rental yield, and low vacancy rate.  Since it cannot use the backyard to build more dwellings, it is not a consideration for the smsf.

Either way, you must remember a couple of things;

1. In a downturn, it's the expensive property in prestige suburbs that has further to fall.  I watched with great interest over the various dips in the market over the past few years, and the boring working class suburbs did not dip at all.  Meanwhile the fancy suburbs took a flogging.

2. Presuming you've got the trifecta I talked about above, a dollar earned in Mt Druitt is the same as a dollar earned in Bondi.  You can get wealthy in boring or dicey suburbs.

Here's an example for you.  I've just bought a house in a suburb that has a "stigma" attached to it.  As far as I'm concerned, it has great growth, great yield, and low vacancy.  The tenants residing in the property gush about how awesome "the location" is.  I mean the Safeway Liquor sign literally lights up the loungeroom.  You cross the road and you've got a shopping centre and various other things like Video Ezy, a bank and all the rest of it.  The way these tenants gush about the location you'd think it was across the road from Bondi, but you know what, everyone has different needs, and as the cost of living goes up, property within spitting distance of shops is heading into the high demand terrain.  If you live close to the shops you can do without the massive expense of owning a car. People can toddle back and forth to the train station to commute to work pretty easily. 100m, 400m, 1km, whatever. You are only carrying your handbag. But when you go to the supermarket you come out of there laden with bags full of orange juice, canned goods, and other heavy stuff. You either want to go across the road and be home already or be shuttled door to door, minimum fuss, on the bus.

Don't write Mt Druitt and Blacktown off just because they are not prestige.  You don't have to live there.  You just have to understand the needs of tenants that would live there. 

I have both in the Blacktown LGA.  For me it's never a case of unit VS house. It's about the numbers.

My villa and unit in Blacktown were under market and I didn't need to do anything to them. Put the rent up to market value and they were both CF neutral. Same tenants were in and stayed in. They have gone up in value. Easy money.

My houses I bought because they needed lots of work. I bought them under market and did a reno. This gave me instant equity and they were CF neutral to + straight away.

If you buy a unit VS house and do no work on either the unit will give you a better gross yield but you need to factor in strata. But in a house you have extra insurance and maintenance. Units are less work than houses from a maintenance perspective(in my experience anyway).
Depends what your strategy is and if it fits with your portfolio. I'm not adverse to either.I have half villa/units to houses.

The houses go down land goes up theory doesn't always hold true.
My tiny 1 bed unit has seen 50% growth in the last 4 years. It's about demand and supply. Just because something doesn't have a large land content it doesn't mean it won't go up with the rest of the suburb.