Elizabeth, North Adelaide, SA

Discussion in 'Where to Buy' started by orcades, 16th Apr, 2007.

  1. orcades

    orcades Member

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    We are considering buying an investment property in Elizabeth, north of Adelaide. It sounds like a lot of growth is expected for the area. My only concern is that a few large housing deveolpments are going ahead. Does anyone have any thoughts on how that will affect the demand for rental properties? Currently rental demand is good, but we'd hate to buy a house that then sits empty.

    We are from NSW and have never been to that area, but are planning a trip to Elizabeth soon to check it out. Any info would be great!

    Orcades.
     
  2. Prakman

    Prakman Member

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    Hi There Orcades,

    I'm from WA and have purchased two properties in the Elizabeth area. I have not visited SA and have no plans in the immediate future to visit there.

    I am however am a real estate agent within the Harcourts network and have had great chats with some local agents without the BS.

    In general Elizabeth is a lower socio area but with a great number of tennats. Not all tennants are good, land lord protection insurance is recommended.

    You should stay away from semis unless you can buy both pairs. Try to buy under 150K for stand alone houses as they are subdivideable in the future and also the rental returns are much better (around 6-8%).

    Good luck and let us know whether you've bought any properties.

    Happy hunting.

    Prak
     
  3. steveadl

    steveadl Member

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    Orcades,

    I've been investing in the area for the last couple of years. Prices have increased substantially from 5yrs ago, but I still believe there is plenty of growth left.

    Depending on what suits your needs, you can either buy brand new houses (or near new) in the developments you spoke of, mor you can buy the older houses in the area.

    I have bought 2 new properties in neighbouring Davoren Park, and Smithfield Plains, which have both already shown good capital appreciation for me in only a short time which has given me more leverage into my latest investment, which is an older property.

    Even the house and land packages available by builders have increased substantially in the last year or so. They were starting at $165,000+, now you'd be hard pushed to find them below about $190,000

    If you were looking to buy old, I STRONGLY agree with Prakman - don't buy just one half of a semi. Leaves too many factors of external influence you have no control over (unless you can buy both sides).

    If you are looking at the southern Elizabeth suburbs (there are about 8+ "Elizabeth's") you will pay more because it is closer to the Adelaide CBD. Check out Whereis.com.au to get a better idea of the different suburbs.

    I personally have decided to buy a property (this month) in Elizabeth North - the furtherst North suburb of the Elizabeth's. My reasoning is that it is only an extra 1-2km from the rest, but I have managed to buy a stand alone house on an 805m2 block for $139k. There are a lot more semi's than there are stand alone's so it's not as easy to get them, but I believe they are worth the premium. Development has also recently started in Elizabeth North with about a dozen or so new houses now built in different pockets, so I believe the house prices have some catching up to do.

    Basically, if you can get a property for about $140k or less (or even up to $150k in my opinion) - I believe you will only basically be paying land value, as the new estates in the area are offering 400m2 blocks for $80k+ now (granted they have nicer surroundings as they are totally new, but you get my drift). Then if it is stand alone, you can rent it out as long as you want, and develop it when ever it suits you, and not being subject to the other half of a semi if you bought that way).

    The semi's conversley (in Elizabeth North) go for $125k to as high as $135k for blocks of about 700-750m2. So you have less land, and are attached as well. If you look at the suburbs further south, you can probably slap on an extra $5-10k for the semi's.

    You could also look at Smithfield and Davoren Park. But if looking at Davoren park, I would strongly suggest to stay away from the Western side. I looked at a property there recently, and the neighbourhood was scary (even for me, who has driven around these suburbs countless times looking at properties). My reasoning for not buying on the Western side is that all the new developments etc (for now) are further to the East, and North. Absolutely no houses have been knocked over for development in this area, and the way the area looks, it could be at least another 5yrs before that area develops as it is really scungy! (Don't let me talk you out of that, other people may have made really good buys there, I just know that for me, I did'nt feel comfortable looking at that side).

    Steve
     
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  4. Jase H

    Jase H Member

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    Orcades,


    My wife and I also own an IP in Smithfield (near new similar to Steves in DP) which we have had only about 9 months and have already noticed that advertised prices for both H&L and near new resales are going up.

    We are also currently building another Ip in smithfield plains.

    Heaps of rental demand and we have a really good tennant in our IP.

    good luck

    Jase
     
  5. Xenia

    Xenia Xenia

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    North of Adelaide is a high tenanted area (more tenants than home owners) and I don't expect demand to drop due to new developments. New houses however will set a higher precedence for house prices and should lift the whole area in terms of capital appreciation.

    We manage many properties in Eliz/Salisbury areas and generally have alot of success in finding good tenants.
     
  6. orcades

    orcades Member

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    thanks!

    Thanks so much for the replies - the info is really helpful. It makes me feel more confident about investing in the area. We have just booked in holidays for June to go there and check out the market - and hopefully buy something. I will let you know how we go!

    Orcades
     
  7. orcades

    orcades Member

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    new house!

    Hi all. We are back from our Adelaide trip and are the proud owners of a house in Elizabeth Downs. It is already tennanted which is great. We found it beneficial to go down there and have a look around at the different areas. We would have found purchasing over the net difficult as some areas are good and some pockets are bad. One house the real estate wanted to show us looked great, but the street it was on was scarey!

    Thanks for all the advice. It really helped.

    Orcades
     
  8. steveadl

    steveadl Member

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    Good on ya Orcades!

    Mind sharing the details ie. land size and purchase price?

    Cheers
    Steve
     
  9. firstmillion

    firstmillion Member

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    Congrats Orcades.

    Hope you had a good trip to Adelaide. it was cold though here for couple of days.

    Cheers
     
  10. Darren1968

    Darren1968 Member

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    Adelaide's Northen suburbs

    I live in Elizabeth South and I'm very happy living here.

    I'm looking to build at Andrews Farm and am currently waiting for the August land release.

    There are some really dodgy areas as previously stated including some areas of Davoren Park and Smithfield. They look like war zones.

    I know 3 large blocks of land (adjoining) with huge development potential that the housing commission is trying to sell and can't get anyone interested. The surrounding streets look like down town beirut and no one is prepared to spend their investment dollars there just yet.

    The majority of areas out there are fine.

    There is also so much happening in the northen suburbs and I think the area has sound investment potential.

    Some of the things that are happening out that way are

    new freeway being built
    complete army batallion moving to the area from interstate (lots of renters)
    many defense related companies are setting up there. (plenty of well paid young engineers looking to rent)
    new coles myer distribution centre just completed
    Edinburgh Parks commercial development in initial stages
    all land west of Heaslip Road being zoned agricultural and not able to be relased for development (less land available - higher demand)

    The two major shoppign centres in the area (Elizabeth City Centre and Munno Parra) have just had multi million dollar expansions completed. Companies like Westfield, Centro, etc don't spend that sort of money on shopping centres if they don't have faith in the future growth of the area.


    Compare that with what is happening down south (not too much I believe) and it all looks good for the future of the northern suburbs.
     
  11. Slammer0000

    Slammer0000 Member

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    Craigmore

    Anyone bought in Craigmore? It looks likea relatively cheapish area with reasonable rental returns. I have been looking around there, only 30kms from CBD.

    Cheers
     
  12. steveadl

    steveadl Member

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    Craigmore is nice, but just be weary. Personally to me it seemed a bit over priced - in some cases more expensive for an older 15yr old house than say a brand new house 1 or 2 suburbs over in Smithfield, Davoren Park, Elizabeth etc.

    Craigmore prices have increased in recent years, in part I believe because it has less of the stigma that was associated with Elizabeth, DP names. But that has started to change.

    Not to say don't buy there :) - all the Northern suburbs will do well in the coming years (see all the reasons above and in other threads), but just make sure you're not spending more than you need to to get an IP in the Northern area. Don't forget, once one suburb does very well, the surrounding sububrs will catch up at some point - so no need to necessarily buy into the original suburb.
     
  13. mystery

    mystery Renovating another

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    Darren 1968,

    Thanks for the info update. I live on the far south cost of NSW, but own one IP in Elizabeth South and I am in the process of buying a second in Elizabeth Vale (settles in a few weeks).

    Like you, I see only positive outlook. In the 12 months I've owned my Elizabeth South IP it has show very good growth and currently has a 7.5% rent return (we actually put a 20% deposit down, so the real return is around 9.3%) ... and my E/Vale IP should give me a 5.5% - 6% rent return (borrowed 100% plus costs).... brilliant.

    I'm very happy with the results so far and the future prospects of the area.

    Martin :D
     
  14. steveadl

    steveadl Member

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    Darren, that's good news. I was wondering how far over they'd let the resedential areas creep. Where did you find this out? Was there any clarification of the northern boundary? I know Gawler Council is keen on keeping their green belt, so not too far to go I would'nt think?
     
  15. Darren1968

    Darren1968 Member

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    Hi Steve,

    I recently spent a day with a real estate agent (who appears to have his finger on the pulse of that area) touring all the current and planned estates in the north and got the run down on exactly what was happening and what is planned out there etc.

    The government was concerned that as the LMC was releasing land that was previously leased out for cropping that the driving of the food growers further and further out was going to be detrimental to the states economy and would cause sharp rises in vegetable prices etc.

    This was also one of the driving factors in the planned new freeway and the Port River Expressway. They wanted to make it easier (and cheaper) to get the food to the population and to the Port.

    I don't know how far north the 'food belt' will extend though but as you said, Gawler is dead set on maintaining their greenbelt. This also bodes well for the areas east of Main North Road. The Blakeview release adjacent to Craigmore (predominantly to provide housing for the new army base) will already be stretching the friendship with Gawler Council so I can't see it going much further North either. This may well have a positive impact on Craigmore prices in years to come too.

    You are probably aware the the LMC has approved the release of large tracts of land on either side of Curtis Rd to Delphin for it's North Lakes Estate.
    Once they have finished in Mawson Lakes (another 18 months to two years) they will be starting out there.
    As the estate will border the North Lakes Golf Course I can also see them spending big dollars revamping the course and attempting to make it a 'resort style' development.
    Land won't be any where near as cheap as has been available in the North up until now though but that is a good thing for people who already own property out that way.

    Darren
     
  16. Ausprop

    Ausprop Member

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    with builders, i've seen a lot of talk about devine and w&m, but how about world concept? are they reputable? is steel frame normal in SA?
     
  17. firstmillion

    firstmillion Member

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    Loads of information Darren. have u purchased anything lately around these areas ?

    Cheers
     
  18. Darren1968

    Darren1968 Member

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    northern suburbs

    Almost but not quite.

    My personal preference is Andrews Farm but the two remaining blocks in the current release were not to my liking (very difficult shapes).

    The next release is scheduled for August and as I already have everything in place finance wise, I am in a position to snap up my ideal block and get the build underway as soon as is possible.

    One thing I like is that the settlement time on the land will be quite long and once the house contract is signed I am basically building at 2007 prices with a scheduled completion date of mid 2008. Although nothing is guaranteed I should be able to realise a reasonable captial gain once the property is complete and possibly duplicate my efforts.

    In short - No I haven't bought in the area (my PPOR is in the area though) but I will have within the next two months.
     
  19. MichaelW

    MichaelW Little Guy, Big Dreams

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    Guys,

    Some great info there, thanks for sharing. Adelaide is already at the top of my list for future IPs but I'm focussed on my development in Mona Vale for the moment... So, I've subscribed to this thread and will keep reading everything posted about Adelaide. I work in the steel industry and our marketing guys are always trying to understand the global steel market so we can do long-term capacity planning. As most everyone knows China is already going ballistic and this isn't likely to change in the near future. The entire population of Australia (20M+) is urbanised in China every year.

    Here's the good news for Adelaide: It is identified as a rich source of future mineral production and most of the worlds producers are currently doing massive exploration in SA. Our guys reckon SA is the next WA with property prices in Adelaide expected to follow the same path as Perth.

    Here's an extract from the AFR last week which might also help paint the picture a bit:

    I'm half tempted to buy a couple of $150K IPs now anyway and stretch myself that little further but I think I'll adopt a more prudent cautious approach and finish Mona Vale first.

    Whoever said: "The opportunity of a lifetime comes along every day" must have had investment properties in mind. We're spoilt for potential when you know how to look for it. I just wish I had more leverage so I could invest more. Oh the frustration! :D

    Cheers,
    Michael.
     
  20. steveadl

    steveadl Member

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    Thanks Darren, no I was'nt aware of North Lakes. More good news though, I like it!