You have had great success investing in inner city, good for you, Btw I have IPs in inner city Too. I am not poo pooing it, just trying to stress that with everything its supply and demand, timing is the key. Therefore 10km will not always provide best opportnities for growth
10km CBD Rule Why?
- Thread starter DCI
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You have had great success investing in inner city, good for you, Btw I have IPs in inner city Too. I am not poo pooing it, just trying to stress that with everything its supply and demand, timing is the key. Therefore 10km will not always provide best opportnities for growth
Hi MTR,
I'm actually agreeing with you. Sorry if I didn't make that clear in my previous post. I've got IP's well outside the 10km zone too. Guess the point I was trying to make is that while those within 10km grow well, cash flow, and affordability could mean that an investor may not be able to purchase within the 10km zone. But that's ok too as there are many ways to invest in property. Btw, I detest BA's with a one dimensional approach and there are many of them around....
You're right. It depends on your strategy and the particular market status at the time. It's hard to make money anywhere if you buy at the peak of the market, at least in the short term. Conversely, if you buy smart in a rising market, you can do well in many different locations. My friend bought in land in Butler years ago and has just finished building a house on the block. End value is far higher than expected and she's done really well out of the development. There is enough equity there for her next IP, which she is really pleased about. For non Perth people, Butler is 40 km from the CBD.
I agree.... 40 years ago it was some what relevant as there was 1 Capital City CBD in the state which was the only real hub for everything.
These days, it's where (in or adjacent to) you are in relation to any of the Satellite CBD's spread around the various states metropolitan areas.
These are high employment hubs with good infrastructures set in place such as major arterial roads in & out, public transport, major shopping centres, good educational, medical, recreational & lifestyle facilities - all the places people like to live close by to.
This bolsters the demand side of the supply/demand equation, thus creates capital growth.
Spot on and the government is spending more and more every year to divest attention from the cbd, eg major infrastructure projects in outer urban areas.
Most of the smart companies recognise rents are cheaper in outer hubs and are basing themselves there.
I would be curious to know how many people here actually work in the cbd and if they don't how often they go there.
Most of the smart companies recognise rents are cheaper in outer hubs and are basing themselves there.
I would be curious to know how many people here actually work in the cbd and if they don't how often they go there.
I don't work in the CBD, go there maybe once a month these days.
However, all my friends and family live within 20km of it, so therefore I prefer to live further in to be around them.
I work halfway between me and the CBD, and as soon as it isn't a work day I head north a couple of hundred km's for some quiet time.
Will live up there one day, when work isn't required.
However, all my friends and family live within 20km of it, so therefore I prefer to live further in to be around them.
I work halfway between me and the CBD, and as soon as it isn't a work day I head north a couple of hundred km's for some quiet time.
Will live up there one day, when work isn't required.
Don't know what you mean by 'smart companies' but I cant see any big employers (which is much more relevant than smart companies) - NAB, CBA, BHP, etc - moving their head office in Dandenong.
Just do a quick Seek search on jobs in the inner Melbourne suburbs compared to the West (or South, North, East) and you'll see where all the jobs are located.
Not sure on the stats but within my group of friends I can't think of any couples where at least 1 of them doesn't work within a couple of km's of the city.
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Uumm.. Perth with such a high volume of FIFO miners I'd say closer to the air port would be more important than the CBD.
Hi,
Interesting topic... All of my IPS that I have purchased have all been in the 15KM to 20KM radius and I have made some nice capital gains along the way
Also it depends what strategy you are looking at!! buying a development site within a 10KM radius is going to cost you allot of coin and you are competing against apartments etc.
Interesting topic... All of my IPS that I have purchased have all been in the 15KM to 20KM radius and I have made some nice capital gains along the way
Also it depends what strategy you are looking at!! buying a development site within a 10KM radius is going to cost you allot of coin and you are competing against apartments etc.
According to last abs stats perth metro had around 15k fifo workers, which was lower than I expected so significantly less than cbd workers.
That's not to say there aren't opportunities that the fifo workers bring of course
Michael Yardney makes a case as to why you would want to stick closer to the CBD in his article:
http://propertyupdate.com.au/not-all-land-is-created-equal-so-buy-in-the-inner-suburbs/
http://propertyupdate.com.au/not-all-land-is-created-equal-so-buy-in-the-inner-suburbs/
M Yardney's company also provides a BA service which promotes properties within close proximity to CBD - usual mantra, "they will provide superior growth". However, history has proven that this is not correct.
As for his charts/stats, in the main I ignore this stuff because stats can be rubbery at best.
MTR
As for his charts/stats, in the main I ignore this stuff because stats can be rubbery at best.
MTR
I agree pretty much that generally speaking, buying in the inner ring will deliver superior growth to buying outside that ring. When we were starting out, in order to acquire a property there, we would have had to pay half as much again as what we could possibly afford. We think it was better to get onto the ladder in an affordable and desirable location than not getting onto the ladder at all. For what it's worth, the house at North Lakes is the only one we have that pays its own way. Next we bought close to the sea, 180 metres is close, right? That place has had long vacancies and is still not worth today what we paid for it.
Giving a personal view of why we lived (before we moved rural) within 10km of the CBD, even tho hubby's job was in a middle ring suburb were:
1. CBD's are usually located on a harbour with beach proximity
2. Great shopping
3. Great social life - cafes, performances etc
4. Great transport links as everything radiated out from the CBD
5. Better quality public schools (in our area at least)
6. Better socio-economic standard of occupants (yes, that makes me a snob)
7. Near quality medical facilities
Do I miss it even tho we have a great rural lifestyle - yes.
Only yesterday the ironman comp was on at one of the CBD beaches and, in the past, we'd just "pop" down for a look and play on the sand - we miss the live shows that we'd nip out to - I miss the great boutique shops that would have amazingly cheap sales at odd times - if any family had to go into hospital for treatment, we lived "right there" - the kids could catch the regular bus that went straight to uni whereas, where we'd live previously in a suburb, they'd have to catch two buses (one into a major centre and then back out to the uni) ...
... it was all about lifestyle rather than capital growth.
1. CBD's are usually located on a harbour with beach proximity
2. Great shopping
3. Great social life - cafes, performances etc
4. Great transport links as everything radiated out from the CBD
5. Better quality public schools (in our area at least)
6. Better socio-economic standard of occupants (yes, that makes me a snob)
7. Near quality medical facilities
Do I miss it even tho we have a great rural lifestyle - yes.
Only yesterday the ironman comp was on at one of the CBD beaches and, in the past, we'd just "pop" down for a look and play on the sand - we miss the live shows that we'd nip out to - I miss the great boutique shops that would have amazingly cheap sales at odd times - if any family had to go into hospital for treatment, we lived "right there" - the kids could catch the regular bus that went straight to uni whereas, where we'd live previously in a suburb, they'd have to catch two buses (one into a major centre and then back out to the uni) ...
... it was all about lifestyle rather than capital growth.
I have achieved higher growth doing both.
But the real gems have nothing whatsoever to do with buying in inner city but more about buying something that is unique, could be development sites, or potentially earmarked for development. In many cases if you dig deeper, these can be the gems, you buy at a low base and achieve superior growth because they are unique and everyone wants them more demand and not enough stock.
Best options for growth IMO are properties which are unique and this wont be limited to inner city.
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M Yardney's company also provides a BA service which promotes properties within close proximity to CBD - usual mantra, "they will provide superior growth". However, history has proven that this is not correct.
As for his charts/stats, in the main I ignore this stuff because stats can be rubbery at best.
MTR
Well said.
