Can regional centres still be considered affordable?
The COVID-19 pandemic has resulted in hundreds of thousands of Australians swapping their major-city life for regional a...
Zoning changes and rising residential interest rates are driving a new wave of commercial investment in the Sydney market, according to a high-profile real estate company.
Changes to state zoning laws and an increase in residential investment interest rates in the middle of last year were the major factors behind the increase, according to Gunning Principal Malcolm Gunning.
“We believe local investors are now moving away from residential properties and are seeking suburban commercial and retail investments, which have good returns with development upside, resulting from the Baird government's changes to zoning for many of the established suburban retail strips,” he explained.
Mr Gunning said that buyers are looking for properties with a 4 per cent yield and potential for growth through mixed-use development.
“We believe properties like this will continue to see a lot of attention throughout 2016, and believe this is a direct flow-on from the changes to zoning and banks' preference to lending more to commercial investors, in particular for property within Sydney's 20-kilometre ring,” Mr Gunning said.
Infrastructure improvements are also helping to revive investor interest in areas such as Sydney’s south and south-west.
“These properties have been a sleeper in comparison to residential properties, and their appeal has activated due to rezoning of areas like Rockdale, Kingsgrove, Revesby and Bankstown to B4 Mixed Use, that allows retail, office and residential development.
“These strips are in close proximity to the new, improved public transport hubs, and after the upgrade to the railway lines they are very desirable because the infrastructure is already in place."