Several parts of Australia are experiencing a lot of rezoning—a process described as "getting greater densities in certain areas"—thereby increasing the demand for properties where people could live in or use to start their businesses.
"In Brisbane, [and] Melbourne, there's a lot of rezoning happening there as well as state governments planning for a future, which involves a lot more people," Smart Property Investment's Phil Tarrant said.
Ed Fernon, who has successfully transitioned from sports to property development, shares some of his insights on finding the areas that are shifting towards becoming a "hot spot" in the midst of rezoning:
Could the prices of similar properties be affected by rezoning?
Ed Fernon: You can have identical properties right next door to each other—same land size, same number of bedrooms, same building—and... [it is possible that] one is double the value of the other one. So going through local governments and councils and things like that, you can often find a lot of those areas.
How can investors and developers deal with these changes?
Ed Fernon: Being astute to local government incentives, as well as state government where their infrastructure upgrades are going to be... [Be] quite savvy around your knowledge. What is your investment time frame? So [start] with yourself and saying, 'Why am I investing? What is my goal? Where do I want to get to in three, five, ten years’ time?'
Then, [look] at all the infrastructure. So, there are so many different [types], whether it's the Northern Beaches Tunnel or West Connects or all those different upgrades. You look around where the entrances to those tunnels are going to be and what that's going to create for different traffic flows and the upgrades they're doing in Parramatta right now. There are all these different areas right around Sydney even with the light route, that there are properties and areas are going to become more connected shortly.
Why are you going to live in Kogarah, which is going to be double the price of, say, La Perouse or Little Bay, if the light rail extends all the way down there and, for five minutes more, are you going to be bothered paying double the price? So I think it's worth having a look at.
What's a great example of the changes that rezoning could bring in terms of property?
Ed Fernon: Redfern's a great example. Look at the amazing change Redfern has gone through.
Phil Tarrant: The new transportation [had gone] through there.
Ed Fernon: Yeah. It's been amazing. And people made a lot of money in that market, but there's this plenty of other Redferns out there right now and it's more rapid—more so than it's ever been in Sydney's history. More infrastructure happening now than ever before.
Tune in to Ed Fernon's bonus episode on The Smart Property Investment Show to know more about the necessary “grunt work” that will benefit prospective property developers by enabling them a better understanding of their market—influencing not only their decisions during the construction phase but the ultimate outcome of their development endeavors.