After a period of consistent downturn, property experts are now hopeful that the Sydney property market will begin its recovery soon. How can investors maximise opportunities in the NSW capital?
Buyer’s agent Robert Skeen currently helps investors buy within the 12 kilometre-radius of the Sydney central business district, including areas such as Maroubra, Randwick and , as well as Gladesville and Drummoyne in the Inner West.
According to him, driving growth into these areas are new infrastructure and new development, as well as the demand for rental properties.
“We have the university and the light rail, among other things happening around there. In Gladesville, there’s a lot of new development, but we focus on the smaller, older ’60s and ’70s-type buildings. We find that they’re quite well priced at the moment and they’re renting well.”
The buyer’s agent said: “The apartment market there has come off by almost 20 to 25 per cent. There’s a property in Cremorne at the moment – two bedrooms, small block of 12, huge balcony, car space, harbour views. In 2017, this would have sold for about $1.2 million. Now, you can buy it at $975,000.”
While there’s no certainty about how long the good buying conditions will last, the increasing confidence in the market has improved buyer’s activity over the past few weeks.
“If we look at the auctions that we’ve been attending, properties have been selling at reserve or, in some cases, a lot more over the reserve. There’s a lack of stock and people are competing for those that are available at the moment.”
“Once spring comes around, I think there’ll be a little bit more choice and prices will probably just even out a bit. But at the moment, it’s not a bad market for a seller,” Mr Skeen highlighted.
While Sydney remains as one of the most expensive property markets in Australia, Mr Skeen said that investors can still find opportunities to own a positively geared property.
The suburb of Gregory Hill, in particular, located around 20 minutes from Camden, offers up to 7 per cent net return on investment.
“If you go out there now, it’s amazing what they’ve built. Huge streets, huge shopping centres, buildings. They’ve got a new hospital going out there,” the buyer’s agent said.
Recently, Mr Skeen and his team helped an investor buy a property in Gregory Hills – a four-bedroom property with a bathroom and a terrace, which have been developed to provide shared accommodation, with each room rented out for $400 a week.
“It’s not those dodgy landlords that pack in seven students in one bedroom. The tenants are usually young professionals or blue collar workers… We think it’s a great strategy. Our client now has five properties scattered in the suburb… along nice residential streets.”
Similarly, Badgerys Creek also offer opportunities to buy positively geared properties, according to the buyer’s agent.
For the most part, Mr Skeen generally focuses on the “blue chip” market in Sydney, or the areas that have consistently strong yields and steady, long-term capital growth.
Typically surrounded by abundant public transport, community facilities and a rich cultural, restaurant and entertainment scene, these markets often boast population growth, infrastructure and government investment and employment opportunities and diversity as their main growth drivers.
Properties in blue chip markets are often more expensive, but the promise of lesser risk and long-term growth makes it worthwhile for most investors.
However, not all investors are advised to jump into the blue chip market, according to the buyer’s agent.
“We find that these areas are long term. If capital growth is what the client’s looking for, these are the areas to buy in.”
“If they’re looking for a bit more cash flow, then we’ll look at positively geared properties or those that are neutrally geared. The strategy really depends on the client,” he concluded.