Top regional investment picks for 2014

By Vivienne Kelly

Two regional areas in Queensland have been highlighted as strong investment prospects for 2014 for offering buyers strong fundamentals without the additional risks that come with mining towns.

Mackay and Townsville in Queensland were picked by RP Data’s Tim Lawless at a Multifocus Properties and Finance event last night in Sydney as regional areas that could offer investors strong returns in 2014.

Mr Lawless said these towns were less risky and volatile than neighbouring mining towns. He said even though mining towns can still offer strong returns, not every investor is capable of profiting in these markets.

“If you’re going to invest in these types of markets [mining towns] you need to have a strong heart for starters, and you need to be able to weather the storms, or really be quite spectacular at picking the cycle and buying when the market bottoms out and selling when it tops out,” he said. “That’s really hard because it happens quickly.”

Mr Lawless said Mackay and Townsville were more stable alternatives to mining towns.

“Some of the service centres around these regions do make really good fundamental investments. Look at Mackay: this is the service centre for the Bowen Basin and it’s much more diversified,” he said.

He said even though Mackay had suffered slight falls in value, it was nothing compared to more volatile mining towns, and investors were at “much less risk of seeing their property value implode”.

Mr Lawless also highlighted Townsville as a strong regional prospect.

“Townsville is arguably the most diversified regional town in Australia. It has ports, commodities, agriculture, government, military, education and tourism," he said.

“Fundamentally, their diversity provides much more stability. I still think Townsville is quite a good market to be looking at if you want to invest in a regional area.”

Mr Lawless also cited Bathurst in New South Wales as a market with strong fundamentals, despite the recent volatility in transaction numbers.

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