NSW Where to buy in Sydney 2019?

My partner and I are looking to buy an investment property in Sydney. Max purchase price is currently $585K. We are looking to purchase a house in order to get our hands on some land.

We currently rent an apartment in Caringbah and are looking to stay here. We plan to rent to rent out the new property.

Some areas we have looked at that include...

- Ashcroft, Mount Pritchard, Sadlier, Heckenberg, Miller
- Cambelltown, Woodbine, Eschol Park, Ambarvale, Eagle Vale, Leumeah
- Hebersham, Lalor Park

We are looking to purchase 3-4 bedroom house on a block of at least 550m2, rental income is approx. $400 - $450 per week. We will hold onto this property for the next 10 years or so.

Where would you buy in Sydney with $585K and why? Any comments or suggestion on these suburbs or other options would be greatly appreciated.

 

Why not buy to live?
Do FHOG apply?

 

Thank you for responding. I was excited to see a response on my very first post!

FHOG do not apply, we have an existing property which is currently tenanted (apartment in St. George area).

$585K does not allow us to buy in the area we wish to live (we could afford an apartment, but definitely not a house) which is why we are currently looking to continue renting as we are and purchase an investment where affordable.

 

In your situation would say think very carefully about buying anything at the moment. Not saying this in relation to possibility of price drops or stagnant markets, more to do with the risk of holding yourself back from buying the PPOR you want. Your lending will be maxed out and without selling your IPs it will be a very long time before you will be able to get finance for a house in the area that you want to live

 

St Helen's park is definitely worth looking at.

 

Come back in 12 months. Until then monitor the market carefully.

 

Thank you for your response. Definitely something we need to carefully consider as our decision now may mean we are unable to purchase PPOR for a long time. I suppose our train of thought is that in the long run may be better off buying where the prices are more reasonable and likely able to grow than looking to purchase our PPOR, prices in our area are around $650K-$700K for an apartment and around $1.2M for a house. Our rent is $440.00 a week so we find this manageable. I am 26 and do not feel the urge to settle in one place just yet which is why we are currently feeling that another IP might be the best way to go. Big call and decision to make!

 

Thanks! There are some nice looking houses that have sold there recently. Something like this one 4 Gibbs Place, St Helens Park, NSW 2560 that sold in January is probably ticking a lot of the boxes for us... What would you say is appealing about St Helens that may make it preferable to some of the other nearby suburbs > Ambarvale, Eagle Vale, Eschol Park? Appreciate your thoughts!

 

Are you sure you want to buy in Sydney? Only because going to a different state eg QLD will reduce your likelihood of having to pay land tax down the track, there may be better growth potential in the short/med term and you will be able to get a relatively better location/larger block for your budget. Sorry to make the decision more confusing!

 

Thank you for your response!
We have been discussing the possibility of looking at other states, I suppose we feel a little more safe choosing Sydney because it is more familiar to us and we have the ability to look at lots of houses in person which is comforting when making such a big decision.

I guess we also feel comfortable with the population and infrastructure growth occurring in Western Sydney - it almost feels a sure thing to us that in 10 years or so we will have ourselves a nice block in a well sought after and popular area.

Although, of course, the best choices are not always within your comfort zone and we do want to look into all of options before committing. If you were in our shoes would you feel more compelled to buy outside of NSW? What states/suburbs appeal to you and why?

 

I haven't been actively investigating investment options lately (there are plenty of threads here for it!) although my first thought is probably Logan in QLD as an area I'm familiar with.

The returns are also better than Sydney, so it should create more of a buffer if interest rates were to rise etc.

 

welcome to the forum @Kevans, I was about to ask your age when I read your first post. now what you want to do make sense, at such a young age, you could do "rent-invest" for some years to catch some good capital growth and max your borrowing.

if the next investment purchase is not only for investment, but also a potential home in the years to come, then QLD is out of the questions.

but if it is only for investment, then QLD makes more sense ( higher yield, better capital growth potential )

 

Personally I wouldn't buy to invest in Sydney at the moment. Believe there are still room for prices to drop which means your money probably wouldn't be working hard for you. Price is not going up anytime soon plus rent is soft so yield isn't great either. So numbers don't work out for investors to come back into this market yet.

If you're open to investing interstate, for $585K budget you could look at suburbs closer to Brisbane CBD about 10km radius - North around Everton Park/Hill and South around Mt Gravatt/Mansfield or with a stretch around Carina/Carina Heights.

Cheers,
David

 

@Kevans someone posted a link to this report earlier in another thread
https://storage.googleapis.com/htw-...month-in-review-february-2019_resedential.pdf
It says that in Austral and Leppington current valuations are coming under the combined original cost of house+land.... suggests good value I would think.
Maybe explore these too...?
(Although I am not sure how a potential buyer could spot a property for which valuation would come in under asking price)

 

Thank you for responding Eric, glad you agree that our idea makes sense. We have heard many opinions from friends or family who believe that purchasing your PPOR is the way to go and we almost feel as if our idea to rent-vest is going against the grain in that sense. We do not believe that our next purchase will ever become our potential home so interstate is not out of the question. Appreciate hearing different opinions and ideas on this forum and will definitely expand our research to include Queensland. In your opinion what areas do you see being a good buy in 2019 - 2021 in QLD?

 

Thanks for your response David! Appreciate your time recommending some ideas and areas. Very helpful to have some names of suburbs/areas to research, we have begun looking into these areas. Although we could buy right now we are happy to wait for the best time and will continue to watch the market.Sydney prices seem to be on a downward trend right now so it make sense to wait, is a similar trend happening in Brisbane right now? Is 2019 a good time to buy in Brisbane or should we be waiting like we would for Sydney?

 

Hey Kevans

I did a quick look into St Helens Park out of curiosity, it has been trending down - I attached some images for your reference.

I agree with Meristone about buying in the stage of the cycle ... its also hard to know for sure for how much longer it will keep trending that way (up to you but personally I don't find it ideal to buy into an asset that declining in value and losing me money over the foreseeable future), and at the moment from checking out the report it hasn't been trending up that's for sure!

In terms of where to buy.... I couldn't tell you and sorry for coming out with all these facts and figures haha I just love it.. but yesterday RP data showed that out of the top 10 sub regions nationally, 4 have been in QLD so maybe worth checking out

 

difficult to say which areas are good to buy in 2019 -2021, no crystal ball here.

However, when focusing on the fundamentals ( government investments, transport, amenities, schools....), you won't go wrong.

it seems the Moreton Bay Region is hot. and the area @David Shih mentioned above are good as well, they are more like the Hills in Sydney ( Castle Hill, Cheery Brooks kind of areas), with your budget, you could get a well located & positioned property ( and possibly development potentials), but the rental yield could be 4% or even lower.

re timing, difficult to pick the perfect time to buy, ( the above mentioned areas are on the upwards trends I think), if you focusing on long term growth, I say "buy the quality properties when you are ready"

 

Like @Eric Wu said, my suggestion would be "buying investment when you can afford it" because no one has crystal ball whether 2019 will be the year for Brisbane or not. We suggest Brisbane because cycle-wise it makes sense. Sydney/Melbourne has just came off once-in-a-lifetime boom, so I think it's unlikely we'll see significant gains in the near future.

What I do know is experienced investors on this forum would've set themselves up already in Brisbane burbs ready for the growth that's coming. I've been following the likes of Arana Hills/Ferny Grove since last year and most 3 bed houses were selling around the $450K mark at start of last year. Now they're more around the $500K mark. So it really comes down to specific suburbs which you'll need to do your own due diligence and convince yourself whether it's worth investing or not.

Cheers,
David

 

Yup. Been waiting for 5 years.
*yawn*
More fun watching the daily fluctuations of the ASX200