Investors in Adelaide - Where are your hot spots

[IFBB]

Any particular areas people are targeting atm?

Watched a segment last night mentioning housing stress, and how a few areas North, and North East of Adelaide consist around 35-40% of families under housing stress, so there could be a few bargains to be had there, but not sure they would have the demand for good sustained GC over the long term

 

[Corey Batt]

I'll say what I always say: I think Adelaide is moving towards fine tuning the 'hub' approach, with several small "cbd's" being established, connected by transport corridors. Look at infrastructure spending, it reflects this. As such I believe if you try to get within close proximity to these hubs, over the next 20 years there should be some good growth.

 

[Jaggannath]

There are a number of light rail improvements, replacing the clanky old diesels with electric trains, so look along these corridors IMO

 

[IFBB]

So you are both thinking further out from the CBD (North/South/West) will have better CG in the future than suburbs closer to the CBD (Norwood, Brompton, St Peters)?

 

[Corey Batt]

I think it is easier to triple $200k than $1M. If you look at growth trends in the outer areas, there are places which have gone from 40k to 200k from a little over 10 years. All the little couples from around here who bought where no-one else would have set themselves up nicely.

So in essence I believe targeting these areas gives a lot of potential: Huge infrastructure spending, 'prettying up' projects, relatively high wages in comparison to low level white collar counterparts, residential development, close to long established major commercial districts. Yields are relatively good in the areas too, so essentially with consistent wage growth and cash flow neutral yields on purchase, the right system can work very well.

Alternatively you can buy up a house in St Peters with an average (poor) yield and hope for growth in a flatlining housing market, poor internal and external economies, retrenching white collar jobs etc.

But as with all things, this is just my opinion. I focus more upon sustained growth than ponzi scheme speculation. Aim for sustained, and you still get the CG in the good years.

 

[IFBB]

Sorry, i should have been a little more specific.

If i were to buy, and just sit on it, i would definitely go for what you mentioned previously. Houses closer to the cbd just yield too poorly to sit and wait for CG, and i dont see anything special happening in the next 5 years anyway.

What i should have added is i would plan to value add to the property - buy the run down unit/house, and renovate for CG. I think those areas i mentioned closer would be of greater benefit from this sort of strategy then something further out, but im happy to hear why others think they wouldnt.

In the end, id just like some more talk about Adelaide in this thread haha. What people are looking to do, where they are targeting etc. I think We are pretty well set up here for the medium to long term in terms of IPs, and our level of affordability, yet we hardly hear a peep about us.

 

[Jaggannath]

Remember that the Clipsal factory near Brompton will be re-developed soon, and once that starts houses in that area will naturally improve their value.

 

[PropertyDave]

:d

Remember that the Clipsal factory near Brompton will be re-developed soon, and once that starts houses in that area will naturally improve their value.

I certainly hope so, I bought a place on 780m2 around the corner from there 18 months ago to develop in the near future. Hopefully it progresses at a rapid pace.

 

[pully]

brompton is close to the city and has good transport links. it has a lot of history, however there are serious contamination issues that need and will be addressed. the current state govt has said it will run into many millions and will take time.
lets hope it is done well. currently there is a lot of social housing in the area.

http://weekly-times-messenger.whereilive.com.au/news/story/brompton-soil-anger/
but yes the location is good. hope they do not build too many of the cheap and nasty, high density type of housing as is being built at mawson lakes.

the 1st housing at mawson lakes looked quite nice around the lakes, but the newer stuff now looks hideous and there are lots for sale at discounted prices. a lot has been sitting for months.

 

[Jaggannath]

I don't trust the places at Mawson's Lakes, I don't trust that the footings they've built are good enough for the swampiness of the land it was built on. Just my thoughts though, I wouldn't want to live there anyway

 

[PropertyDave]

I don't trust the places at Mawson's Lakes, I don't trust that the footings they've built are good enough for the swampiness of the land it was built on. Just my thoughts though, I wouldn't want to live there anyway

West lakes was built on reclaimed wetlands over 40 years ago and the houses seem fine, so hopefully with todays technology they should have done it right.

 

[eslampar]

Industrial western suburbs along Port Road should see growth as the manufacturing plants are forced further out. I just wish Torrens Road was converted into a "Berlin" style wall to block out all the ferals to the north

 

[Corey Batt]

That is an interesting suggestion eslampar, something I have not thought about. You would have to consider the value of the removal of industrial for new builds, however I wonder how much increasing stock in these times would dampen growth.

Then again, any transitions from industrial to resi are LONG term.

Going back on my previous comments on looking at future hubs, the Elizabeth city centre is looking at transitioning from an industrial hub to include multi-level offices, to attract more white collar business. Two eight storey apartment complexes have been put forward to council also.

Interesting times indeed.

 

[pully]

http://www.sensational-adelaide.com/forum/viewforum.php?f=8
this forum discusses development etc around adelaide plus other interesting stuff.
might be of some help to you.

 

[quoll]

There was an article in the Australian a couple of weekends ago, pointing out the potential at Roxby.

http://www.theaustralian.com.au/bus...or-home-deposits/story-fn9656lz-1226190367804

I like the western suburbs, along the train line. NW and SW.

 

[Jaggannath]

There was an article in the Australian a couple of weekends ago, pointing out the potential at Roxby.

http://www.theaustralian.com.au/bus...or-home-deposits/story-fn9656lz-1226190367804

I like the western suburbs, along the train line. NW and SW.

Agreed... if I worked in the city I would have bought in the SW along a train line long ago, but working up Elizabeth way I went for the NW rail corridor. I think the Brompton area will happen soon if you can find a decent run-down property.

 

[Giddyup]

West lakes was built on reclaimed wetlands over 40 years ago and the houses seem fine, so hopefully with todays technology they should have done it right.

Reclaimed sewage ponds.

I wouldnt say they got West lakes 'right'... unless you like Cadmium and other heavy metals in your backyard.

http://www.google.com.au/url?sa=t&rct=j&q=west%20lakes%20soil%20contamination&source=web&cd=3&ved=0CEgQFjAC&url=http%3A%2F%2Fwww.epa.sa.gov.au%2Fxstd_files%2FWater%2FMedianews%2Ffinal_investig.pdf&ctbs=ctr%3AcountryAU&ei=LSjMTquVDeXimAWmj_mNAg&usg=AFQjCNFvHpUqeUQ03B2YTRgYu3RyTaFLfg&cad=rja

 

[BMan]

I'll say what I always say: I think Adelaide is moving towards fine tuning the 'hub' approach, with several small "cbd's" being established, connected by transport corridors. Look at infrastructure spending, it reflects this. As such I believe if you try to get within close proximity to these hubs, over the next 20 years there should be some good growth.

where are these transport corridors and hubs?

 

[eKwatee]

where are these transport corridors and hubs?

Adelaide's North-south corridor

Here's a good map showing you the North-South corridor link.

 

[Corey Batt]

as eKwatee linked, thats essentially the corridor. Then there are the sub corridors such as Main North rd etc. The two hubs which seem to get the lions share of infrastructure spending is Marion (southern area) and Elizabeth (northern).