Bigger place in "smaller" suburb or smaller place in "bigger" suburb

Discussion in 'Property Investment - Other' started by Fisher, 6th May, 2008.

  1. Fisher

    Fisher Member

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    Hi,

    I've looked through some ads and found that I can afford a two-bedroom townhouse in Sutherland or three bedroom one in Kirrawee. Which is just next stop after Sutherland if travelling by train from City.

    What generally be a better deal in terms of capital growth and potential rent in this situation?

    Thanks.
     
  2. Fisher

    Fisher Member

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  3. The Y-man

    The Y-man Member

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    I tried the "smaller properties in the iner suburbs" in the past. I am going to give a shot at "big properties in the outer suburbs" in the coming years to compare the results...

    Cheers,

    The Y-man
     
  4. Kenster

    Kenster Member

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    This sounds like the classic Capital Gain vs Cash Flow consideration.

    I'd try medium sized property in a more desireable location to save both time and money while I live there, yet still have reasonable chance for good CG over time.

    Watch for desireable infrastructure like public transport, good schools where people prepared to pay for top dollars to get in.
     
  5. GoAnna!

    GoAnna! Member

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    Run down house instead of townhouse in better area?
     
  6. TheBacon

    TheBacon Revolutionary

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    OK, looks like its up to me to make the apples v oranges comparison :)

    Be guided by your end goal and the numbers.

    TB
     
  7. Fisher

    Fisher Member

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    Go for a house in an even better area? Sounds a bit too good to be possible. :)
     
  8. Fisher

    Fisher Member

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    Suppose cash flow is about the same: Kirrawee may be less presitgious area, but I can have 3br in there instead of two in Sutherland. Even if the rent will be a bit smaller this is not an important consideration.

    As for capital gain, although Sutherland is more desirible place, Kirrawee is very close to it and in there I can have 3br instead of two. The two suburbs are different in there population in terms of renters vs buyers. More renters are in Sutherlands but more owners are in Kirrawee. When the ripple effect covers this suburb and investors start to buy in there would it have a better CG compared to already established Sutherland? Probably I should re-phrase my question this way.