How to identify the next property growth spot

How to identify the next property growth spot
How many times have you heard someone say an area is on the up?

What are some of the market indicators that support a price rise in any given area and how can you get in before its to late?

Remember that place your family used to take you away when you were a kid, that little coastal or country town?

Can you remember your parents walking past a real-estate window and saying how cheap the local property was?

Can you remember your going back a few years later and hearing your parents curse because the property they could of bought for $90,000 a street back from the beach was now worth $350,000?

We all know that property has risen on average by 11% per year for the last 100 years in Australia, but how do we predict the next hot spot?

Even with all of the information and advice available, putting the pieces together to invest with confidence can be difficult.  Therefore getting in before everyone else is crucial.

Today’s property market in Brisbane, Sydney, Perth and Darwin requires the ability to make quick but informed decisions.

Looking to buy an investment property in the next 12 months? Learn more about how we can help you here…

What to look for according to Tim Lawless, RP Data’s national research director:

New Infrastructure 

  • Improved transport links
  • Mines
  • Major working nodes

Rental yield

  • ‘Look at current rental yields as they often imply there is strong demand.’

Neighbouring suburbs

  • Suburbs with lower housing values compared with their immediate neighbours are also good options as demand naturally ripples out to surrounding suburbs.

Changes to town planning legislation

  • Areas that have recently received a significant change in town planning can also see a significant rise in value.

Demographic tends and supply and demand

  • Another idea is to research the suburb’s demographic trends through the ABS.
  • In locations where there’s significant population growth, demand for housing is likely to increase, meaning prices will likely rise as a result. It’s a simple equation of supply and demand.

Move quickly, but don’t rush in

Purchasing in the next growth spot is of course about getting in before property prices skyrocket.

”Property values tends to gather momentum quite quickly, so the ability to identify these areas before they become headlines in the media is important,” Lawless says.

Keep in mind that once you’ve identified an area your research indicates is a worthwhile investment, ensure you’re not over stretching yourself. It may sound like stating the obvious, but succumbing to temptation and exceeding your budget to claim a property before someone else does is an easy trap to fall into, particularly in a number of Australia’s metro markets at the moment.

Many of us have seen the results our parents have achieved through their life’s work.

Weather or not you come from a culture of investment take the time to identify and focus on a few key regions and put yourself in a position over the next 10 years that will set you up for the rest of your life.

The information provided in this article is of a general nature only and in no way constitutes legal or professional advice, or specific advice in relation to any finance. In all cases we recommend you receive professional financial advice for your own personal circumstances.

Ben Everingham

About

Ben founded Pumped On Property after building a multi-million dollar property portfolio over a 5 year period. His mission is to show you how to replace your income through property investing so you can do what you love…full time.