INVESTORS in search of properties that will deliver high capital growth in the years ahead may find southeast Queensland and certain fringe suburbs of Melbourne safe bets.
These regions accounted for the bulk of high growth property markets in Hotspotting.com.au’s latest Top 10 Best Buys report, which forecasts the 10 best locations for property investors seeking capital growth.
Queensland locations in the report included the Gold Coast, Ipswich and Logan, while the Melbourne regions included the City of Casey and Epping.
Just one NSW location was nominated: Wagga Wagga.
No property markets in South Australia or Western Australia made the cut, but Tasmania had a surprising addition in Hobart.
The report said these locations have “identifiable drivers of demand for real estate, which will place pressure on prices and rents … we expect them to show growth not only in 2016 but well beyond.”
GOLD COAST, QLD
Billions is being spent on infrastructure across the Gold Coast in the lead up to the Commonwealth Games in April 2018, which is expected to bring around 690,000 visitors to the city.
Ongoing projects include the $150 million development of the light rail network and a $42 million aquatic centre.
These and other developments have helped create 15,000 jobs over the past year, adding to the city’s already strong population growth. The Gold Coast’s population is projected to grow by 133,800 people in the decade — the largest population growth in Queensland.
“There will be (property) price growth, especially in the genuine residential suburbs,” the Hotspotting report said. Much of this growth is expected to occur in suburbs along the northern corridor between Helensvale and Brisbane.
Logan City’s combination of affordable property prices, good infrastructure and proximity to job hubs could boost home values.
Many of the region’s older suburbs have been revitalised through urban renewal projects and Logan is already one of the fastest growing municipalities in Australia.
It is being expanded through a $4 billion masterplanned housing community on Waterford Tamborine Road, which will result in 17,000 new dwellings.
There is also a $600 million project to redevelop Jeta Gardens Retirement Village, approved by local council in 2014. The village currently injects $10 million into the local economy annually, but this is set to rise to $100 million.
Tasmania’s economy is rising on the back of big improvements in tourism and business investment after years of lacklustre economic activity.
The property market has started to respond, with sales activity steadily improving since 2012.
Hotspotting pointed out that Hobart presents an attractive package to investors, with high rental returns and prices considerably more affordable than on the mainland.
The city’s most popular suburbs, which include Claremont, Glenorchy, Howrah, Kingston and Moonah, have median prices under $400,000.
The Epping region, on the northern fringe of Melbourne, is due a number of improvements which are likely to bring new people to the suburb and boost property prices, Hotspotting said.
These include the upgrade of the Western Ring Road, further expansion of commuter train services in the region and the relocation of Melbourne’s fruit and vegetable markets to Epping. There is also a new business park in development at Mickleham, which will create 20,000 jobs.
CITY OF CASEY, VIC
The property market in the City of Casey, in Melbourne’s southeast, has been growing, with many suburbs attracting rising sales activity.
The area’s rising population demands new housing estates and the State Government’s long-term planning document — Plan Melbourne — has identified several suburbs in the Local Government Area to play a major role in service delivery and creating employment.
An upturn in commercial development activity began in 2015 with five major projects creating 3,730 new jobs. The planned Berwick Health, Innovation and Education Precinct is expected to provide an additional 9,000 new jobs.
THE REST OF THE TOP 10:
Moreton Bay, Qld: The region offers affordable housing as well as good rail and road links to Brisbane and the Sunshine Coast, making it a strategically placed property market.
Sunshine Coast, Qld: Billions of dollars in service upgrades, including the development of a $5 billion medical hub, are driving an influx of new jobs to the area, in the process, boosting demand for housing.
Sunshine precinct, Vic: Sunshine and surrounds are destined to become a major regional hub within the Melbourne metropolitan area. Extensive investment in infrastructure and amenities will drive demand for property and pull up prices.
Wagga Wagga, NSW: The high number of first-home buyers taking advantage of affordable properties in the area bodes well for Wagga Wagga’s capital growth prospects, the Hotspotting report said. Army and air force bases are expanding in the area, while education, health and other community services are being upgraded.
Ipswich, Qld: A report by the Department of Infrastructure and Transport forecast 56,000 jobs will be created in Ipswich’s central suburbs by 2026. The jobs growth, coupled with affordable prices, will fuel demand for housing, Hotspotting said.