Investing in new suburbs!



From: Anonymous

what are peoples experience and opinions on investing in areas like liberty grove or newington? or areas that are like little suburbs?

seems like the lifestyle of the future, so the brochure saids.

but what is the real opportunity for capital growth?

thanks all, this is a truly wonderful site
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Reply: 1
From: Michael G


I "heard" from a friend that their co-worker was looking at buying in Newington and the lender required a 25% deposit.

Usually when a lender wants more security (ie equity or cash as collateral) the lender considers believes there is higher risk associated there. That is the chance of them recovering their money is reduced.

Same thing occurs with large unit developments, the more units a lender has more mortgages in, the harder it believes it will recover all its money.

This is also apparent with "studio apartments" as these require a 20-40% deposit.

Ask your lender next time, why they will allow 5% in some areas and not in others. It may provide at least one clue.

(of course I'm not a lender, it is only stuff that I have picked up speaking and talking to people)

Michael G.
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Reply: 1.1
From: Sergey Golovin

Good point Michael, about 25% deposit.

Back to Anon - what are peoples experience and opinions on investing in areas like liberty grove or Newington? or areas that are like little suburbs?
Liberty Grove looks like a compound to me. Easy to get in hard to get out – in both terms physical and financial.
When I did mention it to salesperson he was quiet surprised to the analogy and said - yes it does look like compound bit...
I did try to make parallel between British / Australian / American compounds on Middle East (they do have walls up to 1 m thick with barb wire on top of the wall to stop people (radical extremists) and their cars from smashing into the compound at night time), but it did not sink in. Obviously hi is not aware either of Middle East or western European compounds on the Middle East.

But he was impressed with the idea...

But then again some people do like that way – to live in compound.

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Reply: 2
From: Rolf Latham

Hi Anon

Seem to be doing pretty well, Newington Im not sure about, but Liberty Grove has seen growths in townhouses of 8 % per annum since completion.

Even the OTP units have been selling in the mid 3s range for a basic 2 bed.

Liberty Grove is close to a railway station and has great facilities. Today's hot fashion mini suburb may be tommmorows cold suburb when tastes change. These types of estates are increasinlgy common overseas and also interstate so I would suggest they are here to stay, when broad acreage land is available


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