Where to Buy Property in 2017

Managing Director of Cohen Handler, Simon Cohen names his top growth suburbs across Sydney, Melbourne and Brisbane and gives advice on where growth is slowing.

The first quarter of 2017 has slipped by but for those looking to buy a residential or investment property this Autumn or later in the year, the major capital cities of Sydney, Melbourne and Brisbane offer opportunities, particularly anything close to new infrastructure.

According to Simon Cohen, co-founder and Managing Director of leading buyer’s agency Cohen Handler, Sydney’s under-construction light rail, new large-scale developments in Brisbane and locations close to public transport in Melbourne are all key drivers in the growth of certain suburbs. Below is Simon’s advice on where and what to buy this year:

Sydney Infrastructure Impact

For Sydney, a great investment is property near the CBD and South East Light Rail that is currently being built and will give more efficient access to the CBD. Due for completion in 2019, the light rail will have a significant impact on the suburbs close by. The 12km route will feature 19 stops, extending from Circular Quay along George Street to Central Station, through Surry Hills to Moore Park, then to Kensington and Kingsford via Anzac Parade and Randwick via Alison Road and High Street.

According to Simon, there is already a noticeable pattern of young professional couples buying in areas near the new light rail in NorthbridgeCastle Cove, the Lower North Shore, and Cammeray.

In the inner city, there is growth in suburbs like Kensington, which is also close to the light rail, but also located near the University of NSW (UNSW) and the Prince of Wales hospital. For property investors that means increased number of tenants, including students and health workers seeking accommodation.

Additionally, a lot of investors have begun purchasing property on the Central Coast as suburbs around there have low entry prices, converting to a solid investment for the future. There has been about 15 to 20 per cent growth in the area in the past year and the returns are sitting at 5 per cent.

Simon says that on the flipside, there are a few areas that will be slowing down during 2017, including Artarmon and the Northern Beaches. Still on the North, Frenchs Forest has seen huge growth but this will level out over the next 12 months.

The apartment market in Bondi is going to slow down as well due to the increase in developments that will be finalised in the next few years, increasing supply in the area.

‘The hottest property types in Sydney are two or three bedroom apartments in the east and inner city areas, as a large number of downsizers sold these last year,’ he says.

‘In North Sydney, family homes will be a great investment. There is also quite a trend for first home buyers entering the property market to buy one bedroom, one bathroom, no parking properties in the inner city suburbs of ChippendaleSurry Hills and Darlinghurst. This is due to the popularity of sharing platforms such as AirBnB, which has boosted the short-term holiday rental market.’

Public transport key in Melbourne

An increasing Melbourne population, has lead to worsening traffic congestion resulting in a growing trend of purchasing property within good walking distance to public transport, particularly rail. An example of this is the recent purchase of a 64 sqm block in Albert Park that sold for $1.3 million.

Proximity to public transport, parks, restaurants and bars are all drawcards for the central Melbourne suburbs of Carlton and Fitzroy to BrunswickNorthcote and Thornbury, and across to CoburgPreston and Reservoir. According to Simon, the ripple effect that has occurred within these suburbs will continue north in 2017.

In relation to a slowing down of prices for certain areas this year, the inner west suburbs of Melbourne such as Yarraville and Seddon will see a rental yield compression trend, as the perceived ‘value’ of these suburbs are being called into question, particularly in comparison to the suburbs of the inner north.

He says, there will be a possible oversupply issue in East Brunswick due to the sharp increase of the number of apartments either for sale or under construction in the area.

In terms of property types, Melbourne residents are happy living on smaller blocks of land, and this trend will continue.

‘At Cohen Handler, we firmly believe that land should be viewed as qualitative rather than quantitative when it comes to dimensions and that is being reflected strongly in the market,’ Simon says.

Brisbane developments on the rise

In Brisbane, the areas of ClayfieldWooloowinNew FarmPaddington and Ascot are going to see a lot of growth in the next year, due to an increase in large scale developments being constructed in the area, Simon predicts.

However, NewsteadAlbion and South Brisbane are slowing down as these are the areas that developers were building in, but moving away from in the next year or two.

‘Purchasing a house anywhere in Brisbane is a good investment in the long-term, but paying attention to location is more important. If you can’t afford a house in a particular suburb, change your strategy and look into units and other small properties. Units in areas like Ascot are great investment options. Keep an eye out for undersupplied areas − while more competitive, these areas often provide great returns,’ Simon advises.

Cohen Handler can help you get the right property at the right place. If you are interested in buying an investment or residential property in Sydney, Melbourne or Brisbane, contact us today to find out more about how we can assist you.

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