Around $600k

At this price you can get much more for your money. Although th­ese sub­urbs have al­ready seen good growth, de­mand is still strong and sup­ply is lim­ited.

Money Magazine Australia - - COVER STORY | 100 SUBURBS | SET TO BOOM -

We are start­ing to push into a price point that of­fers more bang for buck, as in some lo­ca­tions you are now start­ing to shop in the up­per-class bracket. As per our list, this bud­get also brings you into a cou­ple of the big­ger in­come cities, such as Mel­bourne and Can­berra, and we are also get­ting some land as part of this equa­tion.

Dun­lop, ACT 2615 – houses

One of the best mar­kets around the $600,000 price tag is Dun­lop houses. The sub­urb is about 5km north-west of Bel­con­nen and an­other 15 min­utes’ drive into Can­berra cen­tral. It sits next to two mar­kets in our $500,000 price range, Charn­wood and Macgre­gor.

The Lo­ca­tionS­core for June was 79. This is a few points lower than the mar­kets in the cheaper price ranges. But it is still in the “ex­cel­lent” range, which starts at 77.

The Lo­ca­tionS­core for Dun­lop houses has been steadily ris­ing for the past three years. It spent most of the last year above 75 and has edged into the 80s a cou­ple of times.

The stand­out met­ric for June was the va­cancy rate. It has been bet­ter than av­er­age for over two years now and fin­ished June at 0.26%. That level is con­sid­ered ex­tremely tight and can mean only more con­fi­dence for land­lords.

The av­er­age dis­count from the orig­i­nal ask­ing price for June was 4.37%. Our bench­mark for “nor­mal” is 5%. How­ever, for all the mar­kets in this re­port, ex­cep­tional sta­tis­tics are ex­pected and 4.27% isn’t ex­cep­tional. Noth­ing to worry about – just a lit­tle medi­ocre, that’s all.

There was one con­cern­ing met­ric, how­ever. The online search in­ter­est was only 37, which is about half as good as the na­tional av­er­age. Ideally, we’d like to see more searches be­ing con­ducted per prop­erty.

Fern­tree Gully, Vic­to­ria 3156 – units

Fern­tree Gully is about an hour’s drive east of the Mel­bourne CBD. This is the only unit mar­ket in our re­port.

As a gen­eral rule, in­vestors should favour hous­ing mar­kets for long-term growth. Units have higher risk of poor growth over the long term. It’s too easy for a de­vel­oper to ac­quire a house or two nearby and knock them down to re­place them with a big unit com­plex. Re­mem­ber that sup­ply is the en­emy of cap­i­tal growth. For the short term, how­ever, unit mar­kets can be lu­cra­tive, es­pe­cially in small bou­tique com­plexes, so aim to buy a villa unit with good land con­tent rather than some­thing above ground level.

Some prop­er­ties in Fern­tree Gully that look like houses are listed by sell­ing agents as units. They may share a wall with an­other dwelling in a strata-ti­tled block or be an add-on to the side of a house.

The Lo­ca­tionS­core for Fern­tree Gully units at the end of June was 79. Some of the met­rics con­tribut­ing to this high score in­clude:

• A va­cancy rate of 0.25% – tight!

• Over 200 searches con­ducted online per prop­erty avail­able.

• Per­cent­age stock on mar­ket of 0.33%.

• Auc­tion clear­ance rates above 80%.

• Prop­er­ties sell­ing in a lit­tle more than a month. How­ever, there could be a prob­lem for in­vestors jump­ing into this mar­ket right now – it’s al­ready had some big gains over the past few years.

Prices have risen by 40% in the past three years. Although de­mand is still high rel­a­tive to sup­ply, the ex­treme rate of growth must come to an end sooner or later.

Glad­stone Park, Vic­to­ria 3043 – houses

This sub­urb is about 45 min­utes north of the Mel­bourne CBD and just east of Tul­la­ma­rine Air­port. Houses in Glad­stone Park had a Lo­ca­tionS­core of 78 at the end of June 2018.

Prices had a big spurt in 2017, pil­ing on around 20%. This mar­ket has not been left out of the Mel­bourne boom but still has some growth left, ac­cord­ing to the in­di­ca­tors.

Of par­tic­u­lar note are the fast sell­ing times, at around 27 days. Buy­ers have ob­vi­ously missed out on pre­vi­ous op­por­tu­ni­ties and now have their fi­nance sorted and are mak­ing con­fi­dent of­fers quickly.

The auc­tion clear­ance rate was quite high at about 82% at the end of June. Clear­ance rates have been con­sis­tently above 75% for the past three years. Buy­ers would be frus­trated at miss­ing out and might be mak­ing strong of­fers be­fore the auc­tion date.

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