But who cares about South.
He says throwing out the line and asks 'How is the fishing today!'
Where to invest in Adelaide?
- Thread starter Kennyjaiz
- Start date
He says throwing out the line and asks 'How is the fishing today!'
So if you had a choice between investing out north (Elizabeth, Salisbury areas), down south (seaford, aldinga, christies) or in the surrounding areas around the city with a $50k difference between the north/south properties and the properties close to the city, which is preferable?
Out of the three options which would have the highest CG?
Out of the three options which would have the highest CG?
You really have to work those things out yourself.
Consider,
what are the wage differences in the area,
where are the most jobs and their location to the areas discussed
Can people in the inner city afford to extend mortgages at a rate faster than those in the outer suburbs, e.g can an individual buy a house in Prospect for 10% a year later, with a price of say 650k (65k in one year), in comparison to Elizabeth at $200k (20k).
Then consider that inner city has prices so high that rents have not increased anywhere near the same level, so you will be looking at potential rental yields of 2-4%, whilst in outer suburbs you have 6-10%. This will effect your serviceability and whether you're relying upon potential CG, which may result in disaster should it not eventuate - E.G the 750k house, no growth in 1 year, inflation at 3%, interest rate 8%, yield 3%. After taking out your negative gearing, you're still down 5-6%. A loss.
Just some things to consider. Feel free to post your thoughts also, it is good to hear from everyone's views in regards to what is the best location, after all we make up a part of the market.
Consider,
what are the wage differences in the area,
where are the most jobs and their location to the areas discussed
Can people in the inner city afford to extend mortgages at a rate faster than those in the outer suburbs, e.g can an individual buy a house in Prospect for 10% a year later, with a price of say 650k (65k in one year), in comparison to Elizabeth at $200k (20k).
Then consider that inner city has prices so high that rents have not increased anywhere near the same level, so you will be looking at potential rental yields of 2-4%, whilst in outer suburbs you have 6-10%. This will effect your serviceability and whether you're relying upon potential CG, which may result in disaster should it not eventuate - E.G the 750k house, no growth in 1 year, inflation at 3%, interest rate 8%, yield 3%. After taking out your negative gearing, you're still down 5-6%. A loss.
Just some things to consider. Feel free to post your thoughts also, it is good to hear from everyone's views in regards to what is the best location, after all we make up a part of the market.
You're really going to have to be a bit more specific. Property type, price range and narrow down the locations a bit. Otherwise it's just guess work for anyone to offer advice.
Are we talking 1 bedroom units that are $150k North and South to $200k close to the city or are you talking about houses?
Close to the city, are you talking Wayville or Marion type areas?
Gools
Sorry if I wasn't specific. I'm still very much a noob, just starting out and looking to invest my first IP so please bear with me if anything i've said and am about to say, doesn't make sense!
I've always been told that its better to get properties closer to the city if you can afford it, rather than too far out north or south, a lot of people working in or around the city, convenient, close to transport.
Mainly looking at 3 br houses, $250k down south vs $300k around the city area (within a 7-10km radius around the city - looking more towards the south and east of the city, e.g. glenside, goodwood, glandore, wayville, etc).
We're not talking about a high price of $700k here. Surely the $300k houses in suburbs around the city still have the potential for CG? I'm just a bit wary of buying an IP so far out north or south and deal with potential problems with tenants in those areas.
Once again, I'm extremely new to all this and am having a signficant amount of trouble deciding on where to buy!! Bear with me
I've always been told that its better to get properties closer to the city if you can afford it, rather than too far out north or south, a lot of people working in or around the city, convenient, close to transport.
Mainly looking at 3 br houses, $250k down south vs $300k around the city area (within a 7-10km radius around the city - looking more towards the south and east of the city, e.g. glenside, goodwood, glandore, wayville, etc).
We're not talking about a high price of $700k here. Surely the $300k houses in suburbs around the city still have the potential for CG? I'm just a bit wary of buying an IP so far out north or south and deal with potential problems with tenants in those areas.
Once again, I'm extremely new to all this and am having a signficant amount of trouble deciding on where to buy!! Bear with me
Sorry if I wasn't specific. I'm still very much a noob, just starting out and looking to invest my first IP so please bear with me if anything i've said and am about to say, doesn't make sense!
I've always been told that its better to get properties closer to the city if you can afford it, rather than too far out north or south, a lot of people working in or around the city, convenient, close to transport.
Mainly looking at 3 br houses, $250k down south vs $300k around the city area (within a 7-10km radius around the city - looking more towards the south and east of the city, e.g. glenside, goodwood, glandore, wayville, etc).
We're not talking about a high price of $700k here. Surely the $300k houses in suburbs around the city still have the potential for CG? I'm just a bit wary of buying an IP so far out north or south and deal with potential problems with tenants in those areas.
Once again, I'm extremely new to all this and am having a signficant amount of trouble deciding on where to buy!! Bear with me
You can pretty well buy in most locations with 300K.
I think you need to work out what you're looking for in a property first - house on big block for future development, old house or unit for reno for immediate capital gain and increase in rent (or with potential to do later), house or unit in decent condition, low yield, high yield, low maintenence block.
And you need to know why you want what you want, where. What is your long term plan?
Most places you have mentioned have a potential for CG, however if you mean which will happen first/soonest and be the most significant, then most opinions will only be a guess while the housing market has slowed to the extent it has.
It may experience more growth in the mediam term but it could remain flat for a long while (who knows, even a few years). You'll get different opinions on that one here.
Your best bet is to gain enough knowledge that you have confidence to make your own assessments of the market and the economy. Time is on your side.
Sorry if I wasn't specific. I'm still very much a noob, just starting out and looking to invest my first IP so please bear with me if anything i've said and am about to say, doesn't make sense!
I've always been told that its better to get properties closer to the city if you can afford it, rather than too far out north or south, a lot of people working in or around the city, convenient, close to transport.
Mainly looking at 3 br houses, $250k down south vs $300k around the city area (within a 7-10km radius around the city - looking more towards the south and east of the city, e.g. glenside, goodwood, glandore, wayville, etc).
We're not talking about a high price of $700k here. Surely the $300k houses in suburbs around the city still have the potential for CG? I'm just a bit wary of buying an IP so far out north or south and deal with potential problems with tenants in those areas.
Once again, I'm extremely new to all this and am having a signficant amount of trouble deciding on where to buy!! Bear with me
my views on investing in Ade are here....last post about half way through http://www.somersoft.com/forums/showthread.php?p=803810#post803810
Good Luck!
Have slowed down my hunt for my next property a little, and have recently changed my target market with the current situation of the Australian properties.
Moving away from a run down unit in a blue chip suburb to reno, and now have also included units in some northern suburbs, ideally around Elizabeth, or the surrounds.
The question i have, is do you think units are a good go, or stick to housing in these areas? I know there are a lot of new developments going up around there, but think areas surrounding these developments will do better than properties within them, so will not be looking at a new build in Playford Alive for example.
Northern Expressway, new bus routes, and Gawlers first ever bus to the cbd are just a few things that i think the northern suburbs currently have going for it atm, which other regions dont. I also estimate that if there is a downturn, or flat period in the market, these areas will be the best performers. As nice as it is to live in Kensington and surrounds, not many new young couples can afford $600k+ for a house on 500sqm.
To Zincsilv, i think you may need a bit more of a budget if youre looking for a house in those suburbs on only $300k. Perhaps a 2 bedroom unit, but not a house.
EDIT: Another reason for looking north is the yields. I still believe property prices will stagnate for a few years, whilst rents slowly catch up. Im looking for something that i can add value to, and with rents being pretty close to cf+ in the north (higher % than other regions), a renovation could be the thing to tip it over the edge to an income maker. If prices are flat for 3-5 years, and a property starts off cf+, hell, a few rent rises could turn it into a nice little earner.
Im still in no rush, and want to see the publics reaction to the Carbon Tax. I know in my industry (food wholesale), things are tough on many of the merchants, and as quiet as they have been for some time. I do smell a recession coming.
Moving away from a run down unit in a blue chip suburb to reno, and now have also included units in some northern suburbs, ideally around Elizabeth, or the surrounds.
The question i have, is do you think units are a good go, or stick to housing in these areas? I know there are a lot of new developments going up around there, but think areas surrounding these developments will do better than properties within them, so will not be looking at a new build in Playford Alive for example.
Northern Expressway, new bus routes, and Gawlers first ever bus to the cbd are just a few things that i think the northern suburbs currently have going for it atm, which other regions dont. I also estimate that if there is a downturn, or flat period in the market, these areas will be the best performers. As nice as it is to live in Kensington and surrounds, not many new young couples can afford $600k+ for a house on 500sqm.
To Zincsilv, i think you may need a bit more of a budget if youre looking for a house in those suburbs on only $300k. Perhaps a 2 bedroom unit, but not a house.
EDIT: Another reason for looking north is the yields. I still believe property prices will stagnate for a few years, whilst rents slowly catch up. Im looking for something that i can add value to, and with rents being pretty close to cf+ in the north (higher % than other regions), a renovation could be the thing to tip it over the edge to an income maker. If prices are flat for 3-5 years, and a property starts off cf+, hell, a few rent rises could turn it into a nice little earner.
Im still in no rush, and want to see the publics reaction to the Carbon Tax. I know in my industry (food wholesale), things are tough on many of the merchants, and as quiet as they have been for some time. I do smell a recession coming.
Last edited:
Hi IFBB
I think you are right to favour outer suburbs in todays conditions. One thing you can be sure of is there will always be demand for housing in affordable areas, with good transport links, new infra projects, growing population etc etc. You don't need to wait to see anyones reaction to the carbon tax or anything else if you are buying outer northern suburbs - (or outer southern for that matter). they are solid as a rock. In my view Ade outer suburbs should see solid rental growth in the next 12-24 months, followed by a BIG CG spike- (south more than north IMO but depends on your CF requirements)
re: house vs unit. need to find out what type of properties are in demand in the area you want to buy. Ring a few property managers and ask what type of housing is in the highest demand. Personally, in that area, i'd be looking for subdividable land with an existing 3x1/3x2 house capable of achieving a 5.5-6.5%yield as is, or more with a cheap reno. You may be able to find slightly better yields initially in a unit, but I think the CG over even a couple of years will far outweigh the marginally higher yield.
Good luck!
I think you are right to favour outer suburbs in todays conditions. One thing you can be sure of is there will always be demand for housing in affordable areas, with good transport links, new infra projects, growing population etc etc. You don't need to wait to see anyones reaction to the carbon tax or anything else if you are buying outer northern suburbs - (or outer southern for that matter). they are solid as a rock. In my view Ade outer suburbs should see solid rental growth in the next 12-24 months, followed by a BIG CG spike- (south more than north IMO but depends on your CF requirements)
re: house vs unit. need to find out what type of properties are in demand in the area you want to buy. Ring a few property managers and ask what type of housing is in the highest demand. Personally, in that area, i'd be looking for subdividable land with an existing 3x1/3x2 house capable of achieving a 5.5-6.5%yield as is, or more with a cheap reno. You may be able to find slightly better yields initially in a unit, but I think the CG over even a couple of years will far outweigh the marginally higher yield.
Good luck!
Hi Guys,
Christies Beach is number 4 on Peter Koulizos' (The Property Professor) list of Top 10 suburbs to buy in for Capital Growth in Adelaide...
http://www.thepropertyprofessor.net.au/uploads/Professor/Adelaide%20Top%20Ten.pdf
His narrative is missing from that attachment as he obviously presented those slides and I didn't attend so can't add my thoughts. But he's very upbeat on Adelaide and said this in this article out just a few weeks ago:
If he's right, and he's got a history of being a good CG picker, then your Adelaide properties will do well. I'm committed in Sydney with my development and Brisbane with my next PPOR but in about 2 years time I'll be looking to buy again and Adelaide is currently top of that list.
Cheers,
Michael
Christies Beach is number 4 on Peter Koulizos' (The Property Professor) list of Top 10 suburbs to buy in for Capital Growth in Adelaide...
http://www.thepropertyprofessor.net.au/uploads/Professor/Adelaide%20Top%20Ten.pdf
His narrative is missing from that attachment as he obviously presented those slides and I didn't attend so can't add my thoughts. But he's very upbeat on Adelaide and said this in this article out just a few weeks ago:
Peter Koulizos said:
If he's right, and he's got a history of being a good CG picker, then your Adelaide properties will do well. I'm committed in Sydney with my development and Brisbane with my next PPOR but in about 2 years time I'll be looking to buy again and Adelaide is currently top of that list.
Cheers,
Michael
What i have noticed from Adelaide in my short time being interested in property, is that Adelaide is more a steady performer than the other major cities.
We may not get the massive booms of Sydney / Melbourne, but i dont think we get the big downturns either. Were just happy to plod along
We may not get the massive booms of Sydney / Melbourne, but i dont think we get the big downturns either. Were just happy to plod along
What i have noticed from Adelaide in my short time being interested in property, is that Adelaide is more a steady performer than the other major cities.
We may not get the massive booms of Sydney / Melbourne, but i dont think we get the big downturns either. Were just happy to plod along
Adelaide has certainly been a consistent and steady performer so far however, there is discussion suggesting that Adelaide's property market is destined for some strong upward movement in the short to medium term.
Progressive councils that support major transport and infrastructure development off the back of some huge investment in a burgeoning resources sector in South Australia is exciting. Can one draw an inference between Adelaide and the property market in Perth before the boom? Some are suggesting just this and I personally would agree. The market is very affordable and has strong fundamentals.
Needless to say, and it has already been mentioned on this thread, there are some very knowledgeable and experienced investors putting their money where their mouths are.
Jack
Like your thinking JT7, and i can definitely see where you are coming from.
In his articles, he does seem to favour the West & South, with only Kensington mentioned in the east. Im 3km from Kensington, and to be honest i dont see too much more room for growth in the area. Priced up there with your Burnsides etc already.
I still favour the North atm, it does have some nice buying opportunities out atm. It may not have the CG in say the 2-3 that a Kensington / Torrensville could / have had, but in 10 years, i think it will be a winner with all the developments that will be occuring within that timeframe.
In his articles, he does seem to favour the West & South, with only Kensington mentioned in the east. Im 3km from Kensington, and to be honest i dont see too much more room for growth in the area. Priced up there with your Burnsides etc already.
I still favour the North atm, it does have some nice buying opportunities out atm. It may not have the CG in say the 2-3 that a Kensington / Torrensville could / have had, but in 10 years, i think it will be a winner with all the developments that will be occuring within that timeframe.
