VIC Corio & Cranbourne Capital Growth Period Over?

Hi Guys,

With Corio's median price growing by 30% in the last 12 months alone, are stakeholders seeing the growth now fizzle out of this market (i.e. Greater Geelong) now or do you think the area will reach a median price of around $420K before capping out?

Also, Cranbourne has seen double digit growth for the last 2-3 years now. So does everyone think that this market has reached it's maximum for the time being now considering the area has gone up by 150K to 200K in the last few years.

It will be interesting to get everyone's thoughts!

 

These markets have seen some really good growth..

With lending screws being tightened by APRA and Royal Commissoin, and growth Melb/Syd has seen over the last few years, it looks like prices will drop little bit next year before it plateaus in these two markets..

I think we will see more and more opportunities crop up for investors who have finance sorted in 2019 and 2020...

I'll look at Brisbane and Adelaide market at this point. If you bought the right property in right suburb with right zoning, see magic happen..

More importantly, not to mention rent yields are really poor in Sydney and Melb market compared to Adelaide and Brisbane. Perth is starting to look little interesting too from investment perspective...

Good luck!!..

Cheers,

 

The yield has been getting worse and worse for the last 12 months around Geelong as prices continue to rise, so yes my gut feel is the we are near the end of the current growth cycle for Corio. Also check out the latest Geelong thread as last weekend's auction results reflect this.

When I bought in Newcomb last year I was able to secure 5% gross rental yield and you can easily hit that around the Corio area if not higher due to low entry price. Nowadays yield is down closer to 4%...so I'm not sure how many investors would still be willing to jump in, bearing in mind interest rate will likely to go up from this point.

Cheers,
David

 

Very good points.

In terms of Adelaide, due to it being a smaller city, would only houses in that 5-10k range see growth as I know there are some good yields in the south part of Adelaide around Noarlunga Downs and that area. Also, if you didn't have enough budget to buy a house in that 5km of Adelaide CBD range, would getting into those areas via units be suitable for that type of market?

Also I have noticed on the forums that investors are liking north of Brisbane. Would this be up to Caboolture or closer near Deception Bay. The neighbouring suburbs of Rothwell and Deception Bay have a median price difference of $70K which is such a big gap which is interesting.

 

Onka.. shire do have some good buy opportunities close to the water.

Key is to buy something with right zoning, on decent size block with house just good enough to cover the rent. Closer to the water better!!..

Or invest in brisbane market if you already have IP(s) in SA. Diversify is the key ..

 

What do you think the main growth drivers in the Onkaparinga Shire are currently and anything happening in the not to distant future in terms of creating more net migration to that area of Adelaide?

 

Couple of things.

SA Economy-
Contracts totalling $ 90billion over next 20-25 yrs.
Unemployment lower than all states compared except VIC and NSW.
Deloitte report has predicted SA could deliver strongest economic growth in next 12 months.

BEACHSIDE suburbs with a city feel, and homes on large allotments, are tipped to drive house price growth in Adelaide’s south.

About Onk.. Shire-
Yields are great.
Area is gentrifying
Big blocks are being subdivided and town houses being built which will cause land prices to shoot up.
Nearby Port Noarlunga has that cafe vibe and becoming more densely populated.
Beaches are nice.
Block size is a big driver, especially if you have a family … people want a decent backyard.
Couples who were looking in the Brighton area who have been out-priced as far as a first home goes are starting to see more value in the sense they can get modern, appealing townhouses ..

And the list goes on!!...

 

Thanks for all the great insights Jazz!

How is the land supply situation in the southern suburbs of Adelaide around Port Noarlunga area? Also is there any no-go spots in that area?

Also what resources do you use to measure net migration of the area?

 

Around CB or PN. The Closer you are to water the better ..

Try and stay below the median average in both these areas. And if you can break even or atleast avoid negative gearing, that will be best bet!!..

Look at land size of at-least 700+ sqm. Corner blocks are good options..