Hey guys - I'm looking for a bit of feedback about this approach. I have been trying to identify areas with capital growth potential (surprise surprise) and one of my current ideas is to look for new developments like new shopping centres, train lines, highways etc and buy as construction starts.
Lets take an example of Marrickville in Sydney's inner west. I read somewhere that AMP Capital own the Marrickville Metro shopping centre and have applied to double its size. Let's assume this goes ahead. I am guessing there are probably 3 stages of growth around a big project like this;
1) Growth as soon as the project is announced
2) Growth during construction as investors start to buy in the area
3) Growth after construction is finished when the area becomes more popular, rents increase, prices continue going up.
I think getting the growth when it's announced is basically luck from you coincidentally owning a property in the area unless you know someone on the council or someone who can tell you where a project is definitely going ahead.
So I am thinking of finding areas with announced projects and getting in to pick up the phase 2 and 3 growth.
One thing that worries me a little though is that Marrickville has already seen solid growth over the last 10 years so I'm not sure if it would change that much anyway.
What do you think? Can you get in on big capital growth by buying into an area after the development is announced?? There are lots of other suburbs around Australia with similar developments or even bigger projects like transportation infrastructure......
Cheers,
James
Lets take an example of Marrickville in Sydney's inner west. I read somewhere that AMP Capital own the Marrickville Metro shopping centre and have applied to double its size. Let's assume this goes ahead. I am guessing there are probably 3 stages of growth around a big project like this;
1) Growth as soon as the project is announced
2) Growth during construction as investors start to buy in the area
3) Growth after construction is finished when the area becomes more popular, rents increase, prices continue going up.
I think getting the growth when it's announced is basically luck from you coincidentally owning a property in the area unless you know someone on the council or someone who can tell you where a project is definitely going ahead.
So I am thinking of finding areas with announced projects and getting in to pick up the phase 2 and 3 growth.
One thing that worries me a little though is that Marrickville has already seen solid growth over the last 10 years so I'm not sure if it would change that much anyway.
What do you think? Can you get in on big capital growth by buying into an area after the development is announced?? There are lots of other suburbs around Australia with similar developments or even bigger projects like transportation infrastructure......
Cheers,
James