Researching target market for new build

Discussion in 'Development' started by theperthurbanist, 25th Sep, 2018.

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  1. theperthurbanist

    theperthurbanist Well-Known Member

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    Hi all, I'm keen to hear people's thoughts/tips/strategies for researching your target market (either tenants or purchasers) for new builds.

    I am about to start putting pen to paper on the design of a new-build IP for my splitter block and figure the logical place to start is by answering the question: who is going to be renting this home (and/or who might purchase it from me in the future)?

    My initial thoughts on how to answer this question are:
    • Research the demographics and demographic trends of the suburb on websites like ABS : 2016 Census Quick Stats, and .id Community Profiles looking at:
      • Household type/size
      • Age profile
      • Ethnicity
    • Research typical dwelling types (number of bedrooms/bathrooms) in suburb on sites like YIP – Suburb Reports, Realestate.com.au – Invest, REIWA
    • Speak to local agents asking who the target tenants would be for the location/dwelling size and what their key desired features are. Ask the same question for potential purchasers.
    I would see the last point as being probably the most important, but you are really only as good as the advice you receive from each agent.

    What other factors would people consider and how would you go about researching it?
     
  2. theperthurbanist

    theperthurbanist Well-Known Member

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    FYI for those interested in my project itself:

    In my case the type of dwelling will be set to some extent by the block size (247sqm) and maximum permissible site coverage (136sqm at 55%), which to my mind make it a small three bedroom two bathroom dwelling (as double storey isn’t feasible in this location).

    Other specifics of my block (which may effect the target renter/purchaser):
    • located in Parkwood WA
    • a 247sqm subdivided corner block (with its own street frontage)
    • on a ‘reasonably quiet’ culs de sac
    • just across the road from the Whaleback golf-course
    • within the catchment zone for Lynwood High School (which has been moving steadily up the ratings)
    • 6mins/3.5km to major shopping centre (Riverton Shopping Centre); 10mins/5.5km to Westfield Carousel;
    • 5min/3km to Canning Vale light industrial employment (and hopefully the new Nicholson Rd METRONET train station/hub)
     
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  3. freddy

    freddy Well-Known Member

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    I personally wouldnt even consider anything under 400sqm in Sydney. I'm not sure if that's the same thinking in Perth.
     
  4. theperthurbanist

    theperthurbanist Well-Known Member

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    Plenty of high-demand lots below 400sqm in Perth with good capital growth prospects and strong renter demand. It just depends on the location and price-point. The average new lot size in Perth is 376sqm, and that is largely made up of outer greenfield suburbs, so there are plenty of people willing to live on <400sqm in inner/middle ring suburbs. I find it interesting that the same wouldn't be true for Sydney, especially in inner/middle ring suburbs?

    But that is somewhat beside the point of the original question.
     
  5. Big Daddy

    Big Daddy Well-Known Member

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    Some of these links may not work:

    --Suburb characteristics and the pocket of the suburb you build in. Use these tools to check
    atlas.id or Demographic resources | .id the population experts -> Social housing and full demographics (tick)
    Boomtown (Buyer Vs Seller Strength, days on market etc)
    SQM Research (Rents/Asking Prices, yields, vacancy rates)
    Free Suburb Report: Start Your Property Research Now - Residex (suburb report – demographics etc)
    Managed Funds, Shares, Property & Investment News - InvestSMART (suburb report – demographics, prices etc)
    Suburb Profiles for Property Investors | Your Investment Property (suburb profile showing rental yields, yearly/monthly/weekly growth and number of sales)
    Market trends - Landgate (top weekly sales, suburb hotspots,suburbs with highest % increase)
     
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  6. theperthurbanist

    theperthurbanist Well-Known Member

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    Cheers @Big Daddy, all good sites.

    What are the main characteristics/stats you look for to ‘define your target renter/purchaser’?
     
  7. Big Daddy

    Big Daddy Well-Known Member

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    Choose a local gun agent that sells slot in thar area or pocket and ask them what the target market wants at what price point. Also be different from your competitors
     
  8. Shogun

    Shogun Well-Known Member

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    32 results for Parkwood on RealEstate.com

    What can you build on a 250sqm block at what price point that would tempt me away from the $350k to $700k houses on 2 to 3x bigger blocks?
     
  9. Perthguy

    Perthguy Well-Known Member

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    I am not very sophisticated when it comes to research. For mine, I just looked at what everyone was building and then ground truthed the opposite. So, lots of 1 and 2 bed apartments, so I picked free standing 4x2 to ground truth. I then spoke to a few real estate agents about what buyers and renters are looking for but can't find. Also, what features are desirable. If you are building for a niche then all the suburb demographics are not particularly relevant.
     
  10. Westminster

    Westminster Tigress at Tiger Developments Business Member

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    I think with your scenario it's pretty much a 3 x 2 or a 3 x 2 :p
    What some of your research will tell you will assist with design and specification

    If there is an older demographic keen to downsize then you might
    - put the third bedroom closer to the living area so that it could double as a study relating to that area
    - remove hobs from showers and put in wider door frames etc to make it more universal design friendly. Some good links - try http://universaldesignaustralia.net.au/category/housing-design-guidelines/

    If it's younger/small families then
    - bath, bath, bath :p

    Small things to stand out from the crowd
    - pendant lights over kitchen bench
    - nice height ceilings (there is a lot of 70/80s 2400mm ceilings in the area)
    - maintain furnishability with careful window placement to allow light/ventilation but still allow furnishing options in small rooms
    - smart storage - go high if you don't have much space.
    - use cavity sliders for tight areas like bathrooms so that a door swing doesn't eat into the room
     
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  11. theperthurbanist

    theperthurbanist Well-Known Member

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    True @Perthguy , unless the demographics help you to find out what that niche is. For example in Lynwood I understand that most of the housing stock is old 4 x 2 dwellings with a big backyard; however if you look at the demographics they suggest there is a large proportion of ageing couples and single person households - so really the housing stock is not representative of the actual population who lives there (putting aside the debate as to why people do or don't downsize).

    It could be the same situation in Parkwood? I'm not exactly sure yet!
     
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  12. theperthurbanist

    theperthurbanist Well-Known Member

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    Exactly!
     
  13. Westminster

    Westminster Tigress at Tiger Developments Business Member

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    That's interesting as I would have assumed that Lynwood was older and would have been all 3 x 1s with not many second bathrooms. Parkwood is newer and I would think more relatable to Willetton but most of it was built in 60-80s
     
  14. theperthurbanist

    theperthurbanist Well-Known Member

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    I may be wrong on the 4x2 vs 3x1. It was from a presentation on a project I was working on in Lynwood earlier in the year. The main takeaway being that the houses and blocks were typically too large for the demographic.
     
  15. Angad Singh

    Angad Singh Well-Known Member

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    Hey champ,

    Great advice from @Westminster, except I think she missed out on the third (and most viable) options; a 3x2..;)

    I got a cool book on solar passive design if you want to borrow it:). With regards to design- ensuring that the kitchen and living areas are nice and open, and connect well with an awesome outdoor living. Minor bedrooms need to be well positioned and of good sizes to accommodate double beds and built in robes are a must. Master bed should be decent with a walk in robe and a good ensuite. Double vanities are a nice touch too:). Sculleries are also all the rage at the moment, but will depend on space. Design is always about give and take and doing the best with what you have.

    One other point is given the shape/dimensions of your block, sometimes you end up wasting a lot of space in hallways and because of the narrow frontage, you may not be able to fit a functional room, double garage and a front entry. I'm currently working on a couple of projects with narrow lots and we have some cool solutions to this using a side entry, and this type of thing might be the optimum approach for your block too. Come by the office sometime and I'll show you a few of these types of designs.

    Spec/finish and interior design is also critical in smaller homes, but probably start looking at those after you have a floor plan that works.

    Also, I currently have a DA live in the City of Canning at the moment which is relying on "design principle assessment" to create some good quality housing and maximize the profit of the overall development. I'll run you through the details next time we catch up next! We are due for a beverage!

    Cheers,
    Angad
     
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