hi guys, as a newcomer / FHB i have a few ideas in my head i'd like to get opinions on.
I am planning / working on getting my first home (unit) from western sydney and my budget only allows me to look at places from Mount Druitt to Penrith.
1.According to the pyramid scheme, there will always be more lower income families than middle and upper income families.
2.The lower income families are more likely to be renting instead of owning a property, compared to other classes.
3.As demand outstrips if properties values double in the next 3-5 years time, a unit in mount druitt currently worth 200K would still be affordable by most families if it were to become 400k. I'm not sure (since I don't have the experience) whether a place in drummoyne costing 1.5Mill, can double to 3Mill.
Ok, firstly I would like to get everyone's opinions and professional feedback about these points. Then, I would really like to know... Is Mount Druitt really that bad?.
As someone who both lives and invests in the area, I believe you have brought up some good points. As you are aware, most people do not have large incomes, making Western Sydney a much sought after area, because they can afford it.
Contrary to the belief of those who look through rose coloured glasses, there is a lot of value. Not only is the purchase price affordable, the rental yeild is more realistic and let's not forget Land Tax. If you hold inner city properties as investments you will be hit for a huge sum each and every year in that department.
People purchase in this area for many reasons other than affordability. Lifestyle choice is a big one. There are many affordable leisure activities and the traffic is SO much better than the inner ring. Then you also have those who want to live near work, family and friends. Remember, there is a lot of Industrial areas comming online, as well as easy access to the M4/M7 and the rail line.
The area is not all housing department sell offs either. There are many really good suburbs as well as the housing department areas. Many of the housing department stock has been sold off too, so that an area that was really bad 20 years ago is a different suburb today. This will only improve more over time.
Mt Druitt is not without problems, but if you have a good property manager and Landlord insurance you will be fine. It is important to get to know the area and do research on the street(s) as one feral resident can be a nightmare for their immediate neighbours. Luckily there are only a small number of really bad ferals, and they rarely target properties outside of walking distance.
If your budget is $200k, I would suggest trying for a house in poor condition (if you have the skills to work on it) as some only need a little cosmetic nurturing to give a nice chunk of equity straight up.
Good luck.