Growth areas in range of $450k

Hi Guys,

I am looking for my next IP. First 2 being in Moreton Bay Region, I don't want to buy in QLD any more because of land tax and diversification reasons.
My previous IPs have not grown much with first one bought in 2016 and next in 2017. Though I am still optimistic because of the new Petrie university coming up.

But next one needs to be bought with savings and in the range of $450k. Goal is to buy a property with capital growth perspective. Expecting rental yield in the range of 4.5%+ so that I can maintain my servicability as well. Hearing good things about SA but already out of Melbourne and Sydney so dont want to go to another non capital location.

Buying in Melbourne does not look good idea at the moment with it being at the wrong end of property cycle along with Sydney. Can the experts on this Forum please guide where can I head towards for my IP. Thanks!

 

How about Perth? Check out the deals that people are sharing here which may be able to give you some idea:
Post a Bargain - Perth 2019 [WA]

Or have a listen to our recent podcast with one of the BAs at Perth to get a feel of whether this is an option for you:
Ep18 - Is Perth the next investment hotspot ?

Also I wouldn't write off Adelaide completely too. Like Brisbane I think there are some area that will be solid performers in the years to come which may surprise people. Again our recent chat with @D.T. may provide some insights into Adelaide:
Ep23 - Busting myths around investing in Adelaide!

Last but not least - disregard where your next purchase is, I would focus on acquiring something that has potential to add value down the track. So you can manufacture growth yourself rather than relying on the market or, "hope".

Good luck!

Cheers,
David

 

Hi @David Shih , thanks a lot for sharing so many links. I will check them. I was a bit apprehensive of Perth because as heard from so many people, it still has stagnancy period of 2 years or more. But will check the links. Totally agree to your point on manufacturing equity. Not at that stage at the moment. May be will look at that a couple of years down from now.
With 2 QLD properties being houses on 600 sqm+ blocks, I hope, there is some population increase there and I could manufacture some equity via improvements, thanks!

 

Question is, do you really want to wait till everyone is talking about how good Perth is performing and then jump in?

Chances are if you follow the herd and only buy what others are suggesting you should buy, the areas would've already gone up as media would've hyped about it afterfact.

Perth prices have pulled back alot so while I'm no expert in that city, holistically speaking it does make sense to pick up something decent in that city now as you'll have little competition. You can negotiate hard, put in low ball offers and if vendor doesn't want to budge then just move onto the next deal. The numbers will have to work for you before you pull the trigger.

By choosing something that you can add value later on which means you don't need to wait for market to recover, and when Perth does rebound you'll be laughing.

Cheers,
David

 

Plenty of quality regional and a few coastal options in that price range few hrs out of Sydney or Melbourne if you want NSW or VIC to diversify. As david said I do think the potential in the actual property is super important not just the broad location. However you have said you don't want non capital property and you also said you don't want Sydney or melbourne and you don't want QLD. So how many cities are left? Not sure what advice you are actually asking for?

 

I'm an older first timer and I'm very new to this so please do not take any advice from me, your figures are in the same ballpark as what I'm looking for at the moment. I've been researching full-time for about 6 months now, reading as much info as I possibly can, listening to podcasts etc etc etc. I've looked at a countless number of properties and of course...followed Facebook groups and forums. My opinion so far......the market is somewhere between booming and dropping by 40% (the consensus seems to be flat/going nowhere in the short term) very confusing. I'm 45 years old and I have learnt a lesson or two along the way. I was a keen wanna-be property investor in 2003-4, I seem to remember that there had been a good rise in property prices around the time, the news media and doom-sayers were calling a massive property bubble and there were daily reports of Sydney home owners that had gone into negative equity. Anyway, It was enough to ward me off (I'd probably be planning a very early retirement by now if I hadn't listened to them ). Then life happened, kids came along and the very busy lifestyle ensued, my property investment plan got placed on the back-burner. Looking back, time appears to heal all wounds in the property market as it would have If I had started a portfolio in 2003, but at 45 I'm going to have to be a little more careful of what I buy and where. I'm thinking of contacting Empower Wealth, love the property couch podcasts and have heard good things about these guys. Good luck with your choice @SydneyInvestor , I will be interested to see what your final choice is.

 

Hi @BuyersAgent , thanks for your response. Sorry for my confusing statement. I am actually looking for any regional or coastal options in NSW or Vic which still have room to provide much capital growth and not stagnate for coming years.

 

Thanks mate!

 

No problems. In my humble opinion, there are some decent options around $450k and 4.5% yield but capital growth short term is harder to predict. Focussing on towns with significant new infrastructure projects coming in at the same time as constrained housing supply may give you some extra gains in the first few yrs plus buying well and manufacturing some gains with a renovation or subdivision etc. Local knowledge and picking quality streets/micro-locations is also an important factor. The rest will be up to the market longer-term (everything reverts to the mean eventually) so if you look at areas where baby boomers and young families are moving you should minimise the impact of stagnation as you describe. Every market flatlines for a period of time eventually so I don't stress about that but I do love gains in the first 3 yrs if I can get them. Its really impossible to crystal ball the future long term, but one way forward is to decide what metrics matter to you and select markets that stack as many of them in your favour as possible. Then you just need to decided if/when/how to pull the trigger and buy something. Time has to do the rest.