Stay away from Western Sydney?

[tiger]

Why is just about everyone advising to stay away from western and south western Sydney?

I know they are the areas affected heavily by affordability issues and mortgagee sales but surely they have to grow! Just looking at suburbs around Mt Druitt and other cheap suburbs there, some of the bordering suburbs have a significant price difference, one would think the cheap areas will have to recover at some point!

I'm not particularly talking about this forum, Im talking about magazines, TV and other places who dont seem to think that western sydney is a good investment choice.

 

[Raddles]

Hi there
when the popular media is telling you to stay away from Western Sydney it is the time to start looking.
I may be criticised for the following comments - but you do have satellite areas in places such as Parramatta and Penrith - you do see the ripple effect from these centres.
I do believe the tide is turning in Sydney and those interested in purchasing a property in readiness for the next property wave should be getting in now. People have to live somewhere - and you will see capital growth in these areas - particularly along the transport networks such as rail and major road systems.
thanks

 

[equitymate]

Buy straw hats in winter...

I think the western suburbs can be unfairly treated as the whipping boy by some corners of the media ( who have never been west of Strathfield )

No doubt the west contains some of the most mortgage stressed suburbs in Sydney, prices could come under further pressure with rising interest rates. Opportunities will no doubt pop up & nobody will ring a bell at the bottom.

cheers

 

[dash11]

I tend to agree, the western Suburbs are untreated fairly probably because there is still a certain stigma attached. We invest there and have had for some time and to date have never had a problem. I don't know of any other suburbs in Sydney that are as close to the cbd as they are, which you can purchase a property on around 600sqm of land for as low as 170k-185k which with little work will return you $200-240 p/w in rent. As with any suburb or area, there are markets within markets and street location will sometimes make the differance

 

[tiger]

People will still want to rent out there, lower income earners who want affordable rentals.
Dont know about 170-185k houses though, I havent seen any in that range! $200k+ is what Im seeing.

 

[Kennethkohsg]

People will still want to rent out there, lower income earners who want affordable rentals.
Dont know about 170-185k houses though, I havent seen any in that range! $200k+ is what Im seeing.

&&&&&&&&&&&&&&&&&&&&&&&&&&
Dear Tiger,

1. What are the median house prices for these suburbs now and during the peak of the last housing boom in August 2003?

2. Do you believe that the median house price in these suburbs have already fully "bottomed out", at this point in time?

3. In terms of the pace of market recovery and short term immedate capital growth to be achieved in the recovering Sydney property market, I believe that it will first happen in the Sydney CBD area before radiating outwards towards these more affordable outer suburbs subsequently.
Do you not agree with me on this?

4. Looking forward to learning from you further, please.

5. Thank you.

regards,
Kenneth KOH

 

[beachgurl]

I sold a property at Oxley Park (St Marys) at the peak in 2003 for 210K (was listed for 230K but was very desperate to sell at the time). A townhouse in the same complex is currently listed for sale for 210K. I'd say the market has bottomed out, or at the very least, very close to bottoming out.

 

[trendsta]

I dont think it has bottomed.

Also, the rates are on the UP, inflation is on the UP, forced sales are UP.. wages of many labour professions that live in western sydney have been sub-dued due to govt policies etc..

Given that credit costs and IR are rising we can see many more bargains before the uptrend starts..

 

[Ahmad Azimi]

Why is just about everyone advising to stay away from western and south western Sydney?

I know they are the areas affected heavily by affordability issues and mortgagee sales but surely they have to grow! Just looking at suburbs around Mt Druitt and other cheap suburbs there, some of the bordering suburbs have a significant price difference, one would think the cheap areas will have to recover at some point!

I'm not particularly talking about this forum, Im talking about magazines, TV and other places who dont seem to think that western sydney is a good investment choice.

Given there is demand, even a rathole can go up in value overtime. The only question in concern is: How fast will it go up in value?

There is no doubt that these areas will go up in price aswell but it might be a slower process than some of these inner city suburbs.

The big issue here is that the people living in these areas, most of them are lower to middle income earners. As interest rates rise; they just cant't afford to keep up with the higher repayments. That's why repossesion rate is very high in these areas.

Now you should keep in mind that not all Western Sydney Suburbs fall in to that category. Suburbs like Parramatta which is Sydney's second largest CBD will be less effected as it is more able to self-sustain than most of the lesser developed suburbs. So the demand for properties in these type of areas will almost always be high.

 

[grossreal]

hi all
not sure if I am correct and you lot will tell me but I did read that blacktown is the demographic center of sydney.
I am looking at blacktown at the moment so what do people think about growth in this area the rental for units is not bad.

 

[alexlee]

What's a demographic centre?

 

[skater]

People will still want to rent out there, lower income earners who want affordable rentals.
Dont know about 170-185k houses though, I havent seen any in that range! $200k+ is what Im seeing.

You're not looking in the right places. All you are seeing is the advertised price. I have bought, in order of purchase, $156k, $180k, $185k & $196K. Admittedly this was 2 years ago, but the market hasn't changed much in that time. It's treading water, waiting for the next upswing.

Another misconception is that they are not all low income earners either. The local shopping centre produced a flyer (as an incentive for new business) which had a cross section of the community & the household incomes for the area. I can't remember the exact figures, but there was well over 50% earning over $75k & around 20% with incomes over $100k.

My neighbour lives in a typical ex-housing dept 3 bed, 1 bath property rented at $210pw. It is certainly nothing special. Young couple with one child. Hubby earns over $90k. They are not planning on purchasing as "they can't afford it", it's "too hard to save a deposit", yet my 18yo has a deposit & is ready to buy just as soon as she gets the serviceability.

 

[grossreal]

hi alex
its a center taking into account all the areas of population within a given area.
and that center changes as population move from one area to another it was parramatta up to about 12 months ago last time I had a look.
it would take in all the areas that would be seen as being part of sydney.
its not my call.
nor is it my view but it is a view of the valuer that did the valuation and I will try to pull up the advert
so they must have pulled it out of some government paperwork will try to find it for you.

 

[knightm]

In terms of growth, its when, not if the west will boom again. Fundamentals are there for growth but being held back by interest rate sensitive population, forced sales etc. Read Kieren Trass' book "grow rich with the property cycle" it is a great outline on how growth ripples through a city. To me it looks like a classic cycle setting up now, premium suburbs have been growing for several years, rents rising, middle ring now set for good times, another year or 3 and the 180k places in the cheapest parts of the west will go like a rocket, but the question is when? I don't want to sit on something thats flat for another 3 years...would like the good years tho - perhaps I am being greedy.

 

[tiger]

You're not looking in the right places. All you are seeing is the advertised price. I have bought, in order of purchase, $156k, $180k, $185k & $196K. Admittedly this was 2 years ago, but the market hasn't changed much in that time. It's treading water, waiting for the next upswing.

Where should I be looking?

I'm looking mostly along train line suburbs - St Marys and surrounds.

 

[steveadl]

Looking through the suburbs - it's amazing how much is available when I search for over 700m2 under $300k. I realise at the moment the Western suburbs are in the doldrums, and it may even continue for some time yet - but seems like some good money to be made there in coming years.

Really annoying that the majority of the houses don't have the addresses listed though!

 

[kissfan]

not sure if I am correct and you lot will tell me but I did read that blacktown is the demographic center of sydney.

Hi GR.

Thought the demographic centre was actually around Granville/Parramatta.

Blacktown is not that far from either though and could indeed be the demographic centre and as the Sydney sprawl continues further outward, I suppose the centre moves with it.

Regards
Marty

 

[twobobsworth]

I think channel 9 news tonight will be interviewing blacktown real estate agents who state they have received a number of calls today wanting to sell up as they can't afford their home with the latest interest rate increase.

 

[grossreal]

hi all
found where I saw it page 60 last weeks sydney morning herald business section 42 first avenue blacktown
orange add development site
tender for the site
have a read if you can get it on line.

 

[BV]

I sold a property at Oxley Park (St Marys) at the peak in 2003 for 210K (was listed for 230K but was very desperate to sell at the time). A townhouse in the same complex is currently listed for sale for 210K. I'd say the market has bottomed out, or at the very least, very close to bottoming out.

Beachgurl

I believe you sold before the peak.
Prices went up further since then but now have come down to 2003 levels.

Cheers