Why would you invest in Newcastle over Ipswich?

[Delilah]

So most people buy for capital growth or rental yields and some us buy for a mix of both. When comparing cities, the average annual growth is often referred to as an indicator of future growth.

When you look at Newcastle suburbs, barely any make more than 6% average annual growth, while Ipswich barely has any suburbs with less than 6% average annual growth. Same goes for rental yields and sure infrastructure changes might need to be looked at but NC has had mining in its vacinity for quite some time and it hasn't boosted these figures more than Ipswich which doesn't have mining (much) in its vacinity.

Just interested in investor choice and examples like this, which I'm sure I could use many.

 

[norwoodman]

When you refer to 6% average growth, over what period are we talking?

In the current market, general observation tends to indicate that the Newcastle market is generally further into the cycle than Ipswich. The comparison isn't exactly fair, given that one is an entire metropolitan region and the other is a subset of a broader metropolitan area - one of them is nearly three times the size of the other.

 

[strongy1986]

Only chumps look at past capital growth

 

[alexlee]

When comparing cities, the average annual growth is often referred to as an indicator of future growth.

On that basis, there is no cycle?

 

[Rolf Latham]

broad acreage land availability is tighter in Newcastle ?

ta
rolf

 

[Delilah]

Well those chumps are often the 'gurus' of property investment and hold many seminars, write books and articles, they always refer to looking at past growth, particularly over 10 years as indicator of future growth. I would think you were extremely negligent not to look at past growth.

6% annual growth over 10 years is what I refer to.


I understand that they are very different areas and population size etc but if I was going to invest today, there is no way I would choose Newcastle over Ipswich. Yes the cycle would indicate which area would move for you first but if you were a buy and hold to gain a mix of equity and rental yield, Ipswich is hands down over NC.

 

[thatbum]

6% annual growth over 10 years is what I refer to.

Yeah but 10 years is too long a period to get any useful information from - past growth is more useful in the context of where we are within a cycle.

Eg. I'm pretty sure nearly all of perth has something like 10% annual growth looking at the 10 year stats. Doesn't mean they are good to buy in currently.