Home buyers and property investors have a window of opportunity to cash in on a range of ‘undervalued’ suburbs before local prices soar above $1m, a new report has revealed.
The research from national buyer’s agency Property Buyer and research group Hotspotting identified the best spots around the country for buyers with a budget of about $1m.
The top locations included a mix of suburbs in Adelaide, Brisbane, Sydney and Melbourne.
Propertybuyer founder Rich Harvey said each of the selected suburbs had positive economic and market fundamentals that suggested strong prices rises in the years ahead.
“While million-dollar suburbs are more common than ever before, there are certain pockets, and certain suburbs, that are primed for superior capital growth,” Mr Harvey said.
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“These top million-dollar markets are not just randomly selected. Rather, they have the classic drivers of population growth, lifestyle appeal, employment opportunities and infrastructure.”
A vital component of the areas flagged in the research were that each was far from new housing estates, Mr Harvey said.
This would ensure a tight supply of housing in the local area, which would make it harder to purchase property there but also created more upside potential for home values.
“The best markets to buy into are often the ones that are hardest to get into,” Mr Harvey said.
He noted that the opposite was often true too: markets that were easier to buy into like new estates seldom saw rapid home value appreciation.
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“The problem with greenfield estates or areas where a lot of new unit stock is in the pipeline is that the ongoing supply keeps prices down. That’s not good for investing.”
Suburbs flagged as good opportunities for buyers included, in NSW, Chittaway Bay, Kotara and Avalon Beach, and, in Victoria, Chelsea Heights and Ferntree Gully.
Undervalued Queensland suburbs for house purchasers included Brighton, Birtinya, Southport and Wynnum West. Flinders Park was the sole entry in South Australia.
Mr Harvey said most of these suburbs were teetering on the edge of a million-dollar median price, with the smartest property buyers purchasing before they tipped over into the new price threshold.
“These types of million-dollar median suburbs are generally undergoing gentrification, which means ongoing price growth and will allow owners to build their wealth for the future,” he said.
“The trick is to get in before they hit the million-dollar median mark and be secure in the knowledge that you have bought in a fantastic location early and will reap the benefits of ongoing price growth for many years to come.”
CHITTAWAY BAY
Mr Harvey said Chittaway Bay on the NSW Central Coast is one of the top suburbs that epitomises the potential of new million-dollar locations.
“Chittaway Bay has the magic of being a ‘20-minute suburb’ where work, shopping and playing can be all close by. It’s on the doorstep of one of the largest employment hubs on The Central Coast, the Tuggerah Business Park, a 75-ha estate, which is considered to be one of the region’s premier business locations.
“Next to this is Westfield Tuggerah, which provides significant shopping and restaurant facilities to the area,” he said.
“Chittaway Bay offers a desirable lifestyle, it has job nodes, good access to transport and plenty of community amenities including a lakefront, which includes many kilometres of bike and walking trails plus public parks.”
WYNNUM WEST
Hotspotting Director Terry Ryder said Wynnum West on Brisbane’s bayside had often been overlooked by investors, but now had a strong capital growth trajectory.
“The suburb is within commuting distance of the CBD by bus or train, allowing city workers to live a bayside lifestyle not far from the office. Importantly, Wynnum West is close to significant job nodes, including the Brisbane Airport precinct and the Port of Brisbane,” Mr Ryder said.
“Wynnum West has long been undervalued, but it is now on a strong trajectory of further growth offering some of the most consistent median price growth on the bayside of Brisbane in the past two years.”
FLINDERS PARK
Mr Harvey said another strong performer was Flinders Park in Adelaide, which boasted waterways and lush green spaces.
“Flinders Park is just three kilometres from the Adelaide CBD, is close to the airport, and is just five kilometres from Adelaide’s famous beaches,” Mr Harvey said.
“It is bordered by the River Torrens to the south, plus, the Torrens Linear Park runs alongside the river with kilometres of walking and cycling paths.
“Flinders Park is also serviced by the Flinders Park Village Shopping Centre and has a number of schools including Flinders Park Primary School and Nazareth Catholic College.”
VICTORIA
Mr Harvey said investors who were dismissive of the Victorian market due to all the recent tax changes were missing out on a market with strong potential.
“Everyone is writing off Melbourne. We are see it as counter cyclic buy. It’s a chance to get in at a lower price while demand is softer. There is a lot of value there right now because it’s one of the fastest growing areas of the country and there will be a (housing market) recovery at some point.”