Sydney IT accounts manager Rob Cooper is one homebuyer who’s looked outside the square. He rents in Woolloomooloo but can’t afford to buy there, so he’s purchased a rental property in a trendy city suburb more than 1,000 kilometres away, in Adelaide.

The median house price in Adelaide is $455,000 compared to Sydney’s $900,000.

“So, West Croydon is the suburb. It’s about 7km away from the city and it was just under $700,000 for a three-bedroom house,” Mr Cooper told 7.30.

“I feel it’s good value for what you get and certainly has the potential to grow, which is the main thing.”

Mr Cooper is part of the generation dubbed “rent vestors” — people who rent where they want to live and buy an investment property somewhere they can afford, with the help of tax perks like negative gearing.

He bought the rental with the help of Bryce Holdaway’s property-investment firm.

Mr Holdaway, a buyer’s agent, described the purchase price as “laughable”.

“In some cases you can’t even pick up a one-bedroom apartment in the same distance, let alone a three-bedroom house on a parcel of land,” he told 7.30.

Mr Holdaway first saw an opportunity in Adelaide about 18 months ago, because homes were affordable and rental returns were good.

“The reason we went to Adelaide were the three Ls — location, land and looks,” Mr Holdaway said. “You can get terrific locations … within 5km of the Adelaide CBD that’s got a beautiful period home on a 600 or 700 square-metre land, well under $1 million.

“Being in that early part of the growth cycle, where you could pick something up that seemed ridiculously cheap by Melbourne and Sydney comparison, was really enticing.”

There is no official data to show how many homes are being snapped up by investors but according to realestate.com.au there had been more than 1 million internet searches on South Australian properties from the eastern states in the past six months alone. The number of searches from Victoria was up 68.6 per cent.

Find out more from the original source: http://www.abc.net.au/news/2017-08-01/cant-afford-sydney-or-melbourne-house-investors-look-to-adelaide/8748210

We take a retrospective look at median dwelling values across the suburbs of Australia to show the deterioration of more affordable housing across the capital cities.

A retrospective look at median dwelling values across the suburbs of Australia shows the bracket creep that has occurred over the current growth cycle, highlighting the deterioration of more affordable housing across the capital cities over the past five years.

At the end of 2016, 7.6% of suburbs nationally had a median house value under $200,000 and 5.9% of suburbs had a median unit value below $200,000.  To put these figures into some perspective, 11.4% of suburbs had a median house value of at least $1 million and 3.0% of suburbs had a median unit value of at least $1 million.

Over the five years to the end of 2016, there has been a substantial decline in the proportion of suburbs with a median value below $400,000.  At the end of 2011, 53.5% of suburbs had a median house value of less than $400,000 and 69.8% of suburbs had a median unit value of less than $400,000.  By the end of 2016, the proportion of suburbs with a median value of less than $400,000 had fallen to 41.0% for houses and 55.3% for units.

Suburb median values by value range,

National, December of each year

A five year retrospective look at the individual capital cities highlights the significant shift in the proportion of suburbs with a median value under $400,000, particularly in Sydney and Melbourne.

In 2011, the proportion of total suburbs with a median house value below $400,000 across each capital city was: 21.2% in Sydney, 28.9% in Melbourne, 40.9% in Brisbane, 40.5% in Adelaide, 31.1% in Perth, 69.2% in Hobart, 2.1% in Darwin and 1.1% in Canberra.  Units offer a more affordable option highlighted by the proportions of suburbs values below $400,000 at: 38.8% in Sydney, 48.2% in Melbourne, 81.7% in Brisbane, 94.3% in Adelaide, 59.8% in Perth, 92.7% in Hobart, 53.3% in Darwin and 44.6% in Canberra.

Suburb median values by value range,

Capital cities, December 2011

By 2015, the proportion of suburbs with a median house value below $400,000 had shifted to: 1.2% in Sydney, 12.2% for Melbourne, 31.4% in Brisbane, 29.5% in Adelaide, 15.5% in Perth, 55.7% in Hobart and 0.0% in both Darwin and Canberra.  For units, the proportion of suburbs with a median value of less than $400,000 in December 2015 were recorded at: 10.9% in Sydney, 34.9% in Melbourne, 64.4% in Brisbane, 87.7% in Adelaide, 37.2% in Perth, 88.4% in Hobart, 51.4% in Darwin and 50.5% in Canberra.

Suburb median values by value range,

Capital cities, December 2015

The proportion of suburbs with a median house value of less than $400,000 at the end of 2016 was recorded at: 0.1% in Sydney, 6.3% in Melbourne, 29.2% in Brisbane, 28.0% in Adelaide, 18.9% in Perth, 52.1% in Hobart and 0.0% in Darwin and Canberra.  For units the proportions were recorded at: 6.5% in Sydney, 31.8% in Melbourne, 62.7% in Brisbane, 85.1% in Adelaide, 46.4% in Perth, 88.4% in Hobart, 57.6% in Darwin and 45.8% in Canberra.

Suburb median values by value range,

Capital cities, December 2016

Five years ago every capital city except for Darwin and Canberra had at least 20% of suburbs with a median house value of less than $400,000.  At the end of last year, it was virtually impossible to find houses for less than $400,000 in Sydney, Darwin and Canberra while less than 7% of suburbs had a median house value below $400,000 in Melbourne.  Across each city there has been a substantial decline in more affordable housing over the past year despite the fact that outside of Sydney and Melbourne there has been only moderate value growth over the period.

Even units have recorded a fairly substantial decline in the proportion of suburbs with a median value of less than $400,000 over the past five years.

At the end of 2016, looking at both houses and units, 20.5% of Sydney suburbs had a median value of less than $600,000 compared to 38.5% of suburbs having a median value of at least $1 million.  To further highlight deteriorating housing affordability in Sydney, 34.6% of suburbs had a median unit value of less than $600,000 at the end of 2016.  In each other capital city, a higher proportion of suburbs had a median house value of less than $600,000 than the proportion of suburbs with a median unit value of less than $600,000.

If you’re interested in starting or growing your property portfolio, contact CPS Property today.

Whether a homeowner or a tenant, parents will tell you that it pays to live in the right school catchment zone. Not only will the catchment mean children are eligible to attend the school, it ultimately provides strong capital growth for the property, making it a fantastic strategic move for investors. Many investors have begun to purchase property near the top performing catchment zones to maximise their return.

Top 10 primary school catchment zones with highest price growth – national

Parramatta Public School – local prices up 56.6%
Ashbury Public School – local prices up 46.6%
Oatley Public School – local prices up 44.9%
Meadowbank Public School – local prices up 43.1%
Epping Public School – local prices up 41%
Glenfield Public School – local prices up 38.1%
Ryde Public School – local prices up 35.9%
Balmain Public School – local prices up 34.8%
Bicton Primary School (WA) – local prices up 34%
Pagewood Public School – local prices up 33.3%

Top 10 high school catchment zones with highest price growth – national

Strathfield Girls High School – local prices up 38.6%
Ryde Secondary College – local prices up 31%
Quakers Hill High School – local prices up 27.1%
Blakehurst High School – local prices up 25.7%
Cherrybrook Technology High School – local prices up 24.1%
McKinnon Secondary College (VIC) – local prices up 22.9%
Epping Boys High School – local prices up 22.9%
Alexandria Park Community School – local prices up 22.8%
Castle Hill High School – local prices up 22.1%
Model Farms High School – local prices up 21.7%

Source: Domain, 2015, http://domain-static.s3.amazonaws.com/pdf/Domain-School-Zones-capital-cities-July-2015.pdf

Like any property purchase, it is important to do adequate research and ensure the figures stack up before making any decisions. If you’re looking at a property on the boundary of a catchment, it’s essential to be certain of the catchment it is allocated to. It wouldn’t be unusual for different sides of the street to be allocated to different catchments. You can now access a Domain mobile app which will identify the correct catchment zone for your dedicated school.

Contact CPS Finance today to discuss your investment options.