Capital city property markets primed for growth

According to him, the only secret to finding the best location for property investment is going back to the fundamentals of a good property.

The property lecturer said: "Look for undervalued areas around prime hubs. It's not just based on median price because before it might just be really cheap because the soil is contaminated."

"Go and have a look, drive down the streets. Are the houses similar in the prime suburb as they are in the undervalued suburb? Are the streets similar? We're looking for wide, tree-lined streets—they're the key there. Then, make sure that you compare apples with apples. If you can tick those boxes, it should be alright."

Mr Koulizos enumerates some of the capital city suburbs that he expects to grow moving forward:

Brisbane

• Herston
• Kelvin Grove
• Woolloongabba
• Redcliffe Peninsula
• Sandgate
• Brighton

Of all the capital cities, Brisbane might just be the best contender for growth. Mr Koulizos said that, at any moment, the capital city ‘should start firing’.

“Adelaide and Brisbane, I think, are the two picks. There’s plenty of picks for Brisbane,” the property lecturer said.

“Woolloongabba is probably my favourite because that's an area that is almost finished in the gentrification process, or there’s the Redcliffe Peninsula and areas just below that, like Sandgate and Brighton.”

Adelaide

• Thebarton
• Cowandilla
• Torrensville
• Hilton
• Hindmarsh
• West Hindmarsh

Adelaide’s inner west can also expect to see significant growth over the coming months due to gentrification, according to Mr Koulizos.

“These are the suburbs that no one wanted to live in the past then suddenly became highly desirable. Areas that gentrify need to be close to the city, close to the water and they must have historical or character buildings.”

Melbourne

• Footscray
• West Footscray
• Maidstone
• Braybrook

Gentrification also plays a big role in the growth suburbs of Melbourne.

However, unlike most markets where houses are deemed better investments than units, Mr Koulizos believes that investors would be better off in the Victorian capital with ‘old-style flats and units’ or small properties as investments.

“Ideally, I’d say buy houses, but you're far better off buying a unit or a small property in a good location than a house or a big property in a poor location because you can never change location. For the same money, you're better off buying a flat or a unit, but never an apartment,” the property lecturer highlighted.

Sydney

• St Peters
• Tempe
• Newtown
• Erskineville
• Enmore

Similar to Melbourne, Sydney’s growth suburbs are all about gentrification and good location.

The ‘unit strategy’ can also work in the New South Wales’ capital where affordability issues continue to affect the property market following the end of the property boom.

According to Mr Koulizos, investors will do well to find gentrified suburbs as well as locations with developing infrastructure and explore their neighbouring areas where the ‘ripple effect’ might be taking place.

“There’s a train line that's heading out through there, across Stanmore, Petersham, Erskineville, and there could be that ripple effect. Newtown has virtually finished that gentrification process. Erskineville has almost finished it. Then, it’s off to Enmore, St Peters, Tempe,” he said.

Perth

• Victoria Park
• East Victoria Park
• Carlisle

Areas close to the city and to the river are investors’ best bets in the Western Australia capital, according to Mr Koulizos.

“They can't go wrong if they're close to the city or they're close to the river. Australians love the water, they love looking at beautiful views.”

Darwin

• Millner
• Rapid Creek

Like Perth, suburbs close to the water are also Darwin’s best areas for investment.

Mr Koulizos said: “Around the world many Western nations also love that. You'll find that properties closer to the water sell for a lot, even though they might be a long way away from other facilities or amenities.”

Hobart

• South Hobart
• North Hobart
• Glebe

While there are good investment opportunities in Tasmania, Mr Koulizos warns investors against low-quality housing.

Canberra

• Narrabundah
• Braddon

As always, according to the property lecturer, staying near the city centre is the best way to maximise wealth-creation potential.

Tune in to Peter Koulizos' episode on The Smart Property Investment Show to know more about his process picking an area set for property growth.