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Best suburbs to invest in 2017
February 8, 2017
Investing in property is a popular strategy for creating long-term wealth. But your success in the real estate game depends on you buying in the right suburbs, at the right time. So where are the best suburbs to invest in 2017?
Whilst there’s no such thing as ‘best’ suburb (as the ideal investment for you will depend on your personal budget, goals and risk appetite), there are certainly areas that are predicted to deliver strong returns for investors this year. They include:
A popular suburb located just 5km from Melbourne’s CBD, Footscray is in the process of rebranding its former ‘working class’ roots into a hip, urban neighbourhood. There are still relatively affordable opportunities to buy into this area, reports Leonard Teplin from Marshall White Projects—whose recent townhouse development in West Footscray sold out in a matter of weeks, at an average price of around $630k.
“Inundated with news of apartment oversupplies, bubbles and the like, buyers are favouring townhouses and smaller, boutique developments of 40 apartments or less,” he says.
Goulburn, New South Wales
Can’t afford to buy into Sydney’s city? Then perhaps you should turn your attention to key regional markets, where your investment dollar can stretch much further.
Sydney investors are showing up in a big way in Goulburn, says Allan McDonald from Professionals Goulburn, and the city’s median house price rose 7.69% last year as a result.*
“Farmers have had probably three years now of exceptional cattle prices, and good seasons. The lamb market and wool market have been strong,” McDonald says. “That helps a town like Goulburn.”
There are several suburbs throughout Brisbane that area tipped to perform well, but it’s Taringa (around 5km south east of the CBD) that property expert John McGrath singled out in his annual McGrath Report late in 2016.
“Situated next to St Lucia and Indooroopilly, Taringa has access to all the same amenities as its blue chip neighbours, but offers better value for buyers,” he says. In the face of impending apartment oversupply, houses make the better investment in this market.
Semaphore, South Australia
Super low vacancy rates and strong yields are delivering twice the good news for investors in Semaphore, a popular beachside suburb located north-west of Adelaide’s CBD. Growth has been off the charts here over the last 12 months, with houses up 21.5% and units up 14.5%.
Homes are so sought after in the central suburb of Moonah that the vacancy rate has shrunk to a tiny 0.5%, and 0.72% in adjacent West Moonah. In this market, yields above 6% are achievable, and the median price currently sits at around $300k, making it affordable for a broad range of investors.
In the last 12 months, Kambah property values have lifted around 4%, which may be just the beginning of a lasting price surge. The family friendly, northern Canberra suburb has a median price of about $530k, and offers plenty of amenities to suit that demographic— including schools, churches, shopping centres and sporting facilities.
Wherever you choose to park your investment dollars, it’s important that you buy with your long-term goals in mind. Do you want to renovate to add value, and then sell for a quick profit? Buy something you’ll hold for 20 years, so you can then live off the rental income? Or purchase a property with a future development in mind? By thinking about your end goals at the outset, you’ll be in a much better position to enjoy a successful outcome.