Read any of the predictions for growth in the residential property sector for this year and you’ll find that the experts tend to agree on one point: demand for inner city properties is set to continue well into 2014 and 2015. For example, John McGrath from McGrath Estate Agents predicted that inner city suburbs in Sydney might rise between 5 to 10% growth over the next year. The National Research Director of RP Data, Tim Lawless, also believes that property demand will remain strong in the next year or so because of continuing high population growth and low interest rates[i]. Property investment in Brisbane, Melbourne and Sydney is also believed to be contributing to the increasing property prices.
What Makes Inner City Properties So Attractive?
There are a few reasons why property investors should consider purchasing real estate – particularly for off the plan developments – within a reasonable driving distance to a major capital city such as Sydney, Melbourne or Brisbane. One of the main reasons is the sheer convenience that these properties offer to potential tenants in terms of access to work and transport options. High value tenants, or those who will be willing to pay for premium, brand-new apartments, are more likely to want to live in and around the city. Inner city areas are also more likely to be well serviced by established amenities such as schools, other educational facilities and shopping. Other reasons that property investment in Melbourne, Adelaide, Perth, Sydney and Brisbane is a sensible long-term strategy include:
- Higher potential for long-term capital growth as demand for these attractive areas continues – as an example, in 2013 property in Sydney grew in value by an average of 14.5%, with Melbourne at almost 9%.
- There is a greater variety of choice in off the plan property with more and more developers building within inner city locations. When considering a property investment it is a good idea to be able to review a number of similar developments in the same area or real estate with similar features. This is particularly important if you are looking at off the plan property, as you’ll want to put your money into an investment that will grow in value and provide great rental returns in the future.
- The biggest employment hubs are found in the capital cities: more workers equals more tenants who are competing to rent your investment property.
- You’ll have greater access to established property investment experts who can assist you in finding and choosing the right property for you, as well as providing the ongoing management of the property over the long-term.
- Having more than one property investment in Sydney, Melbourne, Adelaide, Perth or Brisbane can be a great way to diversify and manage your risk due to local fluctuations in the property market.
Buying property in inner city areas as part of a 10 year investment strategy can be successful with the right planning and assistance from experts in the industry. As one of Australia’s most successful property investment companies, Ironfish is unique in that many of its employees were former investors who decided to pass on the experience and knowledge they’d gained through working with the business. With demand for inner city properties continuing to grow, now is the time to talk to Ironfish about how you can take advantage of opportunities in the market and secure the financial future you’ve always wanted!