The next property investment hotspot

Savvy investors looking to see a quick return on their deposit and strong rental yields should ignore the overheated Sydney and Melbourne markets and head north.

Buyers seeking rapid capital growth in a 12-month timeframe should look to the north Brisbane suburb of Taigum, according to the director of a nationally focused buyer’s agency.

Julie Cumming, director of Canberra-based Hatch Property Australia, believes the suburb is ideally located to capitalise on family buyers pushed out by high inner-city prices and presents an ideal opportunity for investors put off by the high prices in southern capitals.

“You’re still well located to the city, if that’s important – you’re close to the arterial gateway,” Ms Cumming said. “You’ve got the northern busway, you’ve got a lot of education through there and it’s serviced by so much existing infrastructure. That seems to be a good driver, that there’s some solid existing infrastructure.”

The area has already seen a rise in fortunes, something Ms Cumming attributes to the positive impact of new housing stock and nearby renewal projects, including the Queensland Government’s plans to establish the Chermside Centre as an employment hub.

“That belt that’s 10km to 15km north of the CBD has already had some pretty strong growth, in capital growth and also in rental yields, because they’ve opened up a lot of new land there. You can get a four-bedroom house, with a double garage and two living areas, for just under $500,000 to $550,000 depending on how it’s fitted out.”

In the long term, Ms Cumming believes the new development will work to gentrify the traditionally working-class suburb.

“It’s pretty working class in lots of areas there, but it’s really in the urban renewal stage so it’s emerging. It’s well north of the flash inner suburbs, but it’s appealing because you can get in at that price point. Over time, as the new buildings develop, that streetscape will lift and improve.”

However, buyers need to exercise caution when investing in this new stock, as compromised floorplans have been used by many developers in a bid to capitalise on the short-term rental market.

“I think there are some dual-income products going in, which can be fantastic for income, for yield, but I’m always very cautious that you very carefully check out the configuration of the actual dwelling, because they’re often compromised,” Ms Cumming explained. “While the yield may be positive, long-term capital growth may not be nearly as good.

“I would suggest you’re better off with a house, rather than town houses, because a lot of developers are putting in big packs of town houses. I tend to think that given you’re that close to the city, and it is family oriented, it just gives you that point of difference to have a house rather than a town house in a reasonably large complex, or a unit.”

The next property investment hotspot
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