Reading the property market remains a huge challenge for investors and homeowners.
While the national housing market looks strong on an annual basis, with growth running at 8%, prices have actually fallen by 1.2% in the last three months.
And while fears about a housing bubble won’t go away, the housing industry continues to warn of a serious housing shortage that will get worse in 2011.
But don’t worry – SmartCompany is here to help. With the help of three of Australia’s top property experts, we have found 98 property hotspots around Australia, using three distinct methods:
A few clear trends stand out. Ryder is bullish on regional areas for a number of reasons, including moves by state governments to try and decentralise population growth by pouring money into larger regional towns and the fact that independent MPs Tony Windsor and Rob Oakeshott have been able to drive a lot of new spending in the bush.
“I was very strong on the regional areas before that, but that makes it even stronger,” Ryder says.
Lawless’ research shows a clear trend towards suburbs 10 kilometres outside metro areas, where house prices are more affordable.
“With interest rates rising and affordability once again becoming a significant issue, it is no surprise that the middle ring suburbs are becoming more popular,” he says.
“Suburbs along the major transport spines are popular in the lists, which suggest that many buyers are rating both the price and the commuting time into the city or their place of work high on their priorities.”
Of course, the below hotspots should only be taken as a guide. Buyers need to do their own research – and lots of it – before taking the plunge.
Hotspotting.com.au
Terry Ryder says picking a specific hotspot in Canberra is difficult due to what he calls the “homogenous” nature of the market, where different areas have a similar look and feel.
With this in mind, he’s cheating a touch by nominating the Queanbeyan area his ACT hotspot (it’s actually just across the border in New South Wales).
“It’s getting a lot of the growth that is spilling over from Canberra, with strong population growth and new housing developments”
RP Data
Tim Lawless from RP Data nominates suburbs just outside central Canberra as his best performers, and with median prices around $400,000 affordability remains reasonable. Lawless’ hot suburbs include Watson, Holt and Richardson.
Hotspotting.com.au
While Terry Ryder describes Sydney as an underperformer for most of the last six years, he is looking towards one of the former manufacturing hubs of New South Ales in Newcastle.
He says that while the region still suffers somewhat from a reputation as a smoke stack town, most of the manufacturing and steel industry is gone, replaced by the power and coal sector. A $1 billion port expansion has just been completed, and another $1 billion expansion is now underway. The Hunter Expressway should also boost the region’s infrastructure.
The region saw price contraction in 2009, and moderate growth in 2010.
“Looking ahead five years I think its future is bright. It’s affordable, and I think investors and homebuyers are looking for affordability right now.”
RP Data
Two of Tim Lawless’ picks are in the Auburn area of Sydney, while the suburb of Beverly Hills features on the list of hot areas for houses and units. For bargain conscious buyers the suburb of Regents Park has performed strongly, and with a median price of $449,000 for a house it remains relatively affordable.
APM
Yvonne Chan’s picks are much closer to the Sydney centre, including Rushcutters Bay and Tamarama in the east and Lindfield and Meadowbank on the Northern Beaches. However, the list is dominated by units and prices remain strong, with only one suburb – Meadowbank, which is between Parramatta and North Sydney – has a median price below $500,000.
James was the editor and publisher of SmartCompany and LeadingCompany for five years. He is now the Australian Financial Review‘s companies & markets editor, and a former BRW editor.
