When investing in property the best way to maximise return is to recognise and buy in a hotspot. Hotspots will increase in value rapidly and over 5-10 years you can benefit from their dramatic growth.
Property expert Rich Harvey explained the key factors in identifying a hotspot.
It is important to look for areas experiencing urban renewal. This process will add value, but if it is not occurring then an area can stagnate.
Access to the CBD is essential because most demand comes from owner-occupiers and tenants who will need to be able to commute into work.
Areas that have been rezoned can also be fantastic investment areas because their new potential will encourage development. For example, old industrial areas that are set to be turned into housing can see dramatic growth in a short period of time.
Suburbs that are close to new developments like hospitals and train lines can also become hotspots when the projects are completed. However, you don’t want to buy too close to these developments. Noise pollution from close proximity to a main road or train line can devalue a property.