1 bedders in a popular suburb or 2 bedder in next suburb out?

[Jaz]

Hi All,

I'm looking for some advice on location in Sydney's Inner West and the difference in demand and CG when purchasing bigger properties in more affordable, neighbouring suburbs.

Is it generally a better investment to purchase a larger, 2 bed flat in the "next suburb out" instead of a smaller 1 bed flat in the more popular suburb?

e.g 1 bed flat in Newtown v 2 bed flat in Stanmore
or 1 bed flat in Summer Hill v 2 Bed flat in Ashfield?

As this is property number 1 (spending 400-500K), I'm really just looking for the better option in terms of CG, providing demand remains high. Would appreciate your opinions.

Cheers,

Jaz

 

[Rolf Latham]

I suspect there is no solid evidence either way here , and will be based on anecdotal opinions.

Id guess the long term yield on a 2 bed may be better, but CG is tough

ta
rolf

 

[Jaz]

I suspect there is no solid evidence either way here , and will be based on anecdotal opinions.

Id guess the long term yield on a 2 bed may be better, but CG is tough

ta
rolf

So more of a personal preference? I suppose demand plays a big part in the type of property you purchase but I suspect there is significant demand for both 1 bed and 2 bed apartments in this area.

Jaz

 

[luckyone]

I'd have to say I'd go for the smaller apartment in the more popular suburb. But that's so long as the suburb has either been popular for a long time already, or you can see it's an up and coming suburb. I just think you'd be more likely to get the good capital gains in the more popular suburb.

 

[Melbournian]

agreed

check this article out

http://www.theage.com.au/victoria/most-liveable-chinese-think-so-20120804-23mno.html

this suburb in glen waverley is a gold mine for devs.

 

[LisaParker]

Typically, a two bedroom would achieve higher capital growth than a one bedroom and in time achieve a higher rental yield as well, however that is in the same suburb.However, it is difficult to compare a 1 bedroom in one suburb compared with a 2 bedroom in a different suburb.

I would look at the attributes of both suburbs, ie) do they both have railway, coffee shops, amenities etc, or only the more popular one? (rail is a big draw card)

Have you had a look at the make up of household sizes (ie % of singles, couples etc living in the suburbs), or asked the property managers what is in more demand for rental and also sales agents the same thing. Sometimes you will end up with overwhelming evidence that one option is the better choice by sussing out the rental managers experience of demand.

Regards Lisa