I live in Newcastle, and have IPs in Newcastle city, suburbs, Lake Macquarie, Nelson Bay & Central Coast. Each coastal region has different market attributes; it?s necessary to manage them independently.
Newie & the Hunter regions have been following Sydney, from a lower price base, but similar confidence in selling prices, & not coming off the boil just yet. We have been investing in IPs for 20 yrs now, with total confidence in these regions. Although slower CG compared to the capitals, the lower price point makes it easy to continue acquiring properties.
Newcastle & suburbs has solid employment & infrastructure, & has been waiting for the imminent injection of Govt funds to revitalise the city, which after many yrs has now commenced & expected to continue for the next 10 yrs. The region will continue to be buffeted by economic issues, affecting rents & vacancies, but there are strong long term trends that can be relied on.
Vacancies have increased from below 2% up to 3% in the last 12 months. I expect the situation to improve as city renewal projects get underway. Quality properties in inner city suburbs will fair best.
Upper Hunter cities of Singleton & Muswellbrook are very different markets, strongly aligned to the open cut coal mining fluctuations. The peaks & troughs are more frequent.
A fair amount of Student accom for sale, asking a premium due to high yield, but I?ve struggled to locate quality properties to consider buying. Student rental rates appear to have reduced in 2014 from averaging $160 down to approx. $140. Trouble is that most tend to be fully inclusive (furniture & utilities), & the lower rent eats into profitability. Definitely riskier than non-student rentals at this time.
I hope this helps.
Retiree
