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Signs a Suburb May Be Heating Up

Discussion in 'General Property Chat' started by Chilliblue, 10th Apr, 2016.

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  1. Chilliblue

    Chilliblue Well-Known Member

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    Here are my thoughts about what signs to look for with regards to a suburb that may be about to surge in no particular order.


    1. Falling Stock Availability:
    Lower numbers of properties could be an indicator that owners are not wanting to sell. Those properties that do go on the market are snapped up by waiting buyers.


    2. Discounting Reduces: With more buyers, sellers have no reason to offer attractive discounts so the level of discounting reduces.


    3. Falling Average Days on Market: Again, with more buyers in the market and less properties to buy, the amount of time a property spends on the market drops which results in lower average days on market.


    4. More Auctions: This is a great indicator for those suburbs where auctions are not the norm as local agents will auction properties when the demand for property is strong. The belief being that buyers will outbid each other and push the final sale price up.


    4. Falling Vacancy Rates: Lower vacancy rates results in a shortage of rental accommodation. It is generally accepted in the industry that 2-3% vacancy rate indicates a balanced market. A rate below 2% indicates a shortage of rental properties and this occurs, the result is often higher rents which in turn increases sales prices with investors trying to take advantage of higher returns.


    5. Higher Level of Interest: Relating especially to online advertising such as realestate.com.au where buyers can monitor interest in properties. When there are larger numbers of people searching for property in a suburb where stock levels are low, it could be an indication that there is strong demand and values may be about to increase.


    Would love to know your thoughts.
     
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  2. Whitecat

    Whitecat Well-Known Member

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    Falling stock availability I've experienced. I think it's a pretty good indicator.
     
  3. Santaslayer

    Santaslayer Well-Known Member

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    1) Gentrification: Increased attractiveness for owners to establish businesses, build infrastructure, increased investment activity in the area, the vibe just changes...

    2) Average income increases

    3) Crime rates start lowering
     
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  4. MyPropertyPro

    MyPropertyPro SE Qld Property Management & Investor Services Business Member

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    There is a relationship between the number of sales, the days on market and median prices. Check out Property Observer and have a look at the suburb charts on the suburb profiles. A median price rise almost always follows a decrease in days on market and a rise in the number of sales (few month lag for the rise) and you can see it quite nicely on the chart patterns. Much like a technical analysis on a trading platform, I use these indicators to supplement my fundamental analysis of a given suburb or market and to see where it is in the cycle. Although the adage "time in the market" is much more powerful than timing the market, why not try and get a bit of both? ;)
     
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  5. Anita Fursland

    Anita Fursland New Member

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    Get in quick! Don't be the last to Buy when supply is Scarce!
     
  6. House

    House Well-Known Member Premium Member

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    dsrdata.com.au have a very handy free tool that you can sign up for and set alerts for 2 suburbs (upgrade to increase to more) when it reaches a specific trigger point such as when the DOM drops, % of SOM or when the OSI increases/decrease and shows variation from previous months.

    image.png
     
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  7. Propertunity

    Propertunity Exclusive Real Estate Buyers Agent Business Member

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    6. Hot suburb articles start appearing in Property Investment magazines approx 6-12 months after it's all happened.
     
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  8. Biz

    Biz Well-Known Member

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    7: People sitting on milk crates.

    8: People drinking out of jars.

    9: Beards.
     
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  9. bobbyj

    bobbyj Well-Known Member

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    cold pressed coffee for $6.50
     
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  10. CU@THETOP

    CU@THETOP Well-Known Member

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    Datto driving out of there at full speed in the HQ holden with a few empty petrol cans in the back.
     
  11. Foxy Moron

    Foxy Moron Well-Known Member

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    When 100 loud and sweaty lycra-clad mamils (plus wrinkly female equivalents) converge at the cafe you used to like taking your wife to for breakfast on saturday morning ;)
     
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  12. big max

    big max Well-Known Member

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    You missed emergence of hipster coffee shops. Emergence of organic and vegan cafes/restaurants.

    Parking more difficult to get on the streets.

    Younger student types who moved there cause it was cool/cheap and now are refusing to move and as result paying more in rent now they are working.

    Perfect examples include nobby beach and mermaid beach on the Gold Coast and Glebe in Sydney, Paddington in Brisbane (and also Paddington and Bondi in Sydney back in the 90s).
     
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  13. Bran

    Bran Well-Known Member

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    I've long thought this was accurate.

    That and craft beer outlets
     
  14. big max

    big max Well-Known Member

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    Ha ha. Yes forgot about the craft beer. Again Nobbys beach Gold Coast is a perfect example!
     
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  15. Steven Ryan

    Steven Ryan Mortgage Broker Business Plus Member

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    Elevated discussion of area on propertychat.com.au.
     
  16. Mumbai

    Mumbai Well-Known Member

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    Smoke and lots of firetrucks?
     
  17. Biz

    Biz Well-Known Member

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    10: Influx of man buns
     
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  18. Special order

    Special order Well-Known Member

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    Young gay couples out and about walking their miniture pet pigs
     
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  19. Redwing

    Redwing Well-Known Member

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    Guru's start bailing on an area they previously hyped
     
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  20. big max

    big max Well-Known Member

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    So true!