Middle & Top End property market

Hi all,

My background is in shares however I've always paid a close eye to the property market and it's fundamentals.

I just wanted to ask a simple question and see what some of the more experienced investors here thought and maybe some suburb suggestions.

My theory is that the middle-to-top-end market has already started to show signs of recovery however there is a fair bit left to run over the next 1-3 years, as the share market and employment (think bonuses) situation improves and the wealthy sector have more coin at their disposal.

I've attached an article which discusses another rogue element i.e.Chinese investors making their way into the Melbourne market since the Rudd Govts relaxing of overseas investment legislation.

http://www.theage.com.au/business/chinese-buyers-fuel-topend-property-boom-20090918-fvga.html

My question is, what suburbs would one look for in the 700-1M price bracket in Melbourne?

My thought is to focus on suburbs that encompass good schools, 3+ bdr and at least a yard of some note. And of course a reasonable RENT!

I've made an initial list but would love to hear other sugestions or points against any of my choices:

a. Camberwell, Hawthorn, Mont Albert, Caulfield, Alphington, Essendon, Williamstown
b. Ivanhoe, Bentleigh, Mentone, Mordialloc

a = bluechip
b = less recognised but meets the general criteria and would appear to generate a better yield than those in list a.

Sorry for the long post but I wanted to give as much reasoning and background as possible for my plan.

Cheers
C
 
Just another comment I found very interesting from BIS

“If the first home buyers are in the market buying, someone is selling it to them. We’re expecting that increased first home buyers activity to lead through to stronger upgrading demand for people upgrading to their next property,”

Mr Zigomanis said once the (boost to the) first home owners grant expires, and first home buyers drop back out of the market, there’s enough activity in the market so it becomes self-sustaining.
 
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