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David Brewster, Where to buy when capital cities are too expensive
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David Brewster, Buy Property Direct, Where to buy when capital cities are too expensive
Property investors who have been priced out of the capital city markets can still find good investment opportunities if they know where to look.
If you're an investor who feels priced out of the capital city markets, I wouldn't worry too much. In my opinion, capital cities can be a little bit over rated. A lot of construction going on, over flooded markets, high buy in prices, and low returns. For example, in a Melbourne market if you take a South Melbourne or Port Melbourne area where there's a lot of development; your buy in for a 70 square metre 2 bedder, 1 bath, that will run you about $600 000. Your $600 000 investment will probably get you $500 a week return and both areas would grow at about 3 1/2%. If you go further out, say a 30-50km radius, look at an area like Carrum Downs for example, your buy in for a three bedroom, double storey townhouse, 2 bathrooms, double garage - that'll be about $380 000. It'll get you about $380 a week and the growth in that area is 7 1/2%. So it's not as sexy an area but the numbers are very attractive.