Due to a number of factors suburbs that were once considered commonplace may become in demand, giving unexpected profits to property owners in the area.
Investing in an area before growth occurs may seem like a good idea on paper, but how easy is it to predict which suburb will be next big?
Marron Real Estate manager and licensee Rath Marron said building infrastructure in and around the suburbs was a good indication that the government and business expect the suburbs to develop.
“Infrastructure, such as the construction of schools, shopping malls, railways and highways, shows the expected level of growth in the region,” he said.
“Another feature is the resonance of the territory to enable living with greater density. This allows more people to live in the same area and promotes redevelopment, resulting in new, modern homes that improve the overall look and desirability of the area. ”
Licensed real estate partner and licensed auctioneer Mitch Watt said one of the key factors was the effect of rising prices.
“If there is a reasonable proximity to major centers, rising prices in neighboring suburbs are common as inland suburbs become less accessible and buyers and tenants are forced to look further,” he said.
Mr Marron agreed that price and demand in the surrounding suburbs were another factor that could lead to growth.
“Some suburbs need some time to catch up with rising prices in the surrounding suburbs,” he said.
“Often a spike in prices in a neighboring suburb will make another suburb seem relatively cheap, and home buyers are likely to see that over time a cheaper suburb will experience growth similar to the surrounding suburbs.”
Mr Marron said that when considering the area, investors should pay attention to the number of properties currently on the market and the time it took to sell them.
“This indicates a relative demand for the suburbs – if there is less real estate in the market or if the property sells quickly, the more likely it is that the suburbs will experience a certain level of growth,” he said.
Mr Watt said the study of statistics for the area was important.
“This includes crime rates, home ownership versus the amount of rental property, available infrastructure, availability of public transport and schools, and employment opportunities.”
Mr Marron said many experienced investors have sought to acquire in areas with discussions of land zoning changes.
“This is with the expectation that if they buy a large plot of land now, in the future they will be able to share it for profit,” he said.
“While this may be a good idea, it is important to know that until zoning is changed, there is a risk that it will never be implemented due to a change in government or policy.
“This also applies to the government’s proposed infrastructure development, which can be perceived as a value-added for the suburbs.”
Mr Marron said there was a great deal of risk in investing in an area that had not yet demonstrated potential for growth.
“While all research can be conducted before buying a property, growth in the suburbs remains a prediction, with no guarantee that the suburbs will rise in price or to the extent that could be expected,” he said.
https://thewest.com.au/lifestyle/real-estate/signs-of-changing-times-in-a-suburb-c-6790446
