Sydney suburbs with potential- suggestions welcome

[staceyo]

Hi

We're looking to buy in Sydney, hoping to find a 2bed unit/apart in a smallish complex fairly close to Sydney CBD. We're hoping to find something about 350k mark with capital growth being our goal. Not being overly familiar I'd like to hear opinions of where to look. At a quick glance (having only just started by research) areas that appeal so far (going by initial value for our budget) are Lidcombe, Ashfield, Granville (starting to get a bit further out).

Thanks in advance for any help.

Stacey

 

[troyhunt]

Personally, I still like Guildford. 35 mins to the city on the train, 10 to Parramatta, low vacancy, high yield (7%+ achievable) and depressed prices. I've not had any major problems with quality of tenants (good PM) and vacancies have always been filled quickly. Prices and standard of the area seem better than immediately surrounding areas and there are plenty of places within a few hundred meters of the train station.

 

[BV]

Personally, I still like Guildford.

and with your budget you can easily buy a house there instead.

I'd stick to properties with good yields because those have already dropped in price and are unlikely to drop much more.

 

[troyhunt]

and with your budget you can easily buy a house there instead.

True, there are quite a number of houses under the $300k mark. Seems like good value given the proximity but you'd have to manufacture some cash flow or fork out a lot in holding costs. Still, a house within 35 mins of the city for under $300k sounds like a deal...

 

[staceyo]

Thanks guys, out that way is a bit further out than I wanted. As capital growth is our main priority and we're not going to be able to manufacturer our own (cosmetic improvements etc) as we're moving to darwin in a month. So how do you think around parramatta way is looking in terms of growth?

At a quick glance I thought we should be able to get unit within 10-15 kms to sydney cbd. Nothing huge, but nice little investment which should always be in a good position and no problems renting.

Thanks again
Stacey

 

[BV]

Stacey

Since you are looking for units and you don't want to move far from the cbd I'd look at Bankstown, Lakemba, Belmore.

Yields are good and with interest rates dropping these suburbs represent excellent value.

Please note that 1 or 2 people here would tell you not to go near those suburbs but it's a mentality thing, there is nothing wrong with the area.

Cheers

 

[triton07]

I would try something around the St George area, close to coast (Beaches), city (12km), airport, & no problem renting IP.

Maybe something like this:
http://www.domain.com.au/Public/PropertyDetails.aspx?adid=2007417255

Give them an offer of $270k & rent at $370, that's 7.13% yeild.


George

 

[troyhunt]

Thanks guys, out that way is a bit further out than I wanted. As capital growth is our main priority

There was a thread on here a while back debunking the myth that Western Suburbs grew at a slower rate. From memory, there were more fluctuations but the end result was pretty consistent. Might be worth considering.

 

[Gentle_Chief]

Capital growth need not be limited to those suburbs close to the cbd alone. Not everyone works in the cbd and not everyone takes a train to work either. common fallacies, I would say. Infact I read on this forum a couple of months back that St. Marys (a western suburb) had the highest CG in Sydney for the last 10 years.

Personally I am a fan of the hills district surrounding the Norwest business park and Rouse Hill which are the planned growth corridors. Twenty minutes driving time to these suburbs should buy you a winner. Check out:

Seven Hills, Baulkham Hills, Kings Langley, Quakers hills etc.

 

[Highlygeared]

$350K could see you just scrape in to a small apt in the East or Inner west...eg Marrickville, Kingsford, Dulwich Hill, Redfern etc. But you have to be quick. South is fine too eg Kogarah, Arncliffe etc. You can do this
< $300K.

I'd suggest you spend $350K and get into a 2 bed in a better area. Forget the North shore, I dont think $350K will cut it for a 2 bed unless it faces a main rd. As for Northwest, I'd suggest North Ryde given the opening of the new train line into the City.

 

[troyhunt]

Check this out: http://www.smh.com.au/news/national/sydney-property-buoyant-in-slump/2008/10/08/1223145446496.html

"SYDNEY is unlikely to experience the house price collapses affecting other international cities but the least expensive suburbs will outperform the top ones this year, says Shane Lee, the director of economic and market analysis at Citigroup."

 

[peastman]

I bought earlier this year in Chippendale, seems to have good yields and I think good CG prospects, it also was listed somewhere as a "hot spot" suburb. Anywhere in Sydney will do rather well when the financial turmoil settles down.

 

[Tman]

Chippendale good spot and i believe there is more cg in the future.
Ashfield is not a bad place either..

if you are going to buy a unit make sure there is cg in the future because i have bought a unit before and it stays the same price for 5 years while with same price i bought a house last year for 350k and it's value around 400k-420k, so make sure you think twice before buying a unit.

Lakemba, guildford, granville have no cg at all.

 

[BV]

Lakemba, guildford, granville have no cg at all.

Tman

Every suburb has CG, you just need to know when to buy and what to buy.

If we get another 1% interest rate cut a lot of properties in Western Sydney will be cash flow neutral and that's before claiming depreciation.

When this happens people will see that paying rent is similar $ to paying off a mortgage and will go for the later.

 

[troyhunt]

Lakemba, guildford, granville have no cg at all.

Sure they do, all the facts are here: http://reports.rpdata.com.au/cgi-bin/vgmsg/RP_Reports/subprofile/rprephome.p?type=1

 

[stumunro]

Sure they do, all the facts are here: http://reports.rpdata.com.au/cgi-bin/vgmsg/RP_Reports/subprofile/rprephome.p?type=1

exactly... ethnics have jobs and own houses too..

if you look at some of the houses in places like earlwood that sold in the last boom for over 1M commanding some record prices in the area, there were not many aussie buyers..

 

[Tman]

(click for profile) Postcode State Property
Yield Median Price (Jun 2008) 12 Month Growth 24 Month Growth 36 Month

Guildford 2161 NSW House 4.4% $350,000 2% -4% -13%
Guildford West 2161 NSW House 5.1% $325,000 -4% -11% -16%
Guildford 2161 NSW Unit 5.9% $240,000 -9% -21% -28%

 

[BV]

if you look at some of the houses in places like earlwood that sold in the last boom for over 1M commanding some record prices in the area, there were not many aussie buyers..

With the Aussie $ now down by 30%
Oz property has become 30% cheaper and it's just a matter of time before overseas investors and expatriates start buying again.

 

[troyhunt]

(click for profile) Postcode State Property
Yield Median Price (Jun 2008) 12 Month Growth 24 Month Growth 36 Month

Guildford 2161 NSW House 4.4% $350,000 2% -4% -13%
Guildford West 2161 NSW House 5.1% $325,000 -4% -11% -16%
Guildford 2161 NSW Unit 5.9% $240,000 -9% -21% -28%

Thanks for that Tman, great info and shows this area has well and truly reversed in recent times. Given over the long term (decades) the cg has been good it looks likes a the time to buy.

BTW, do you have figures for the 10 years preceding these and what's the source?