Buyers looking to generate fast equity within their portfolio should turn their attention to this up-and-coming region.
Investors who need a quick return on their deposit – and those who have been priced out of Sydney – need to refocus their attention and efforts on the Central Coast in New South Wales, according to Jo Vadillo, principal of Advocate Property Services.
“In the past 12 months we have noticed a large departure of investor interest from Sydney,” Ms Vadillo said.
“Quite simply it has become unaffordable and the competition is so fierce it has [affected] rental yields, and made the renovate-flip strategy nearly redundant. Investors have turned their interests north.
“We are seeing this is particularly applicable to buyers with a budget around the $400,000 to $500,000 mark,” she added.
Sydney's loss is the Central Coast's gain, according to Ms Vadillo.
“Recently, buyer enquiry has really increased for the Central Coast – this region is really benefiting from the knock-on effect of a hot Sydney market.”
Decisions from the local council have worked to further investor interest in the area, she added.
“Gosford City Council has approved millions of dollars’ worth of unit developments, infrastructure improvements to its waterfront, and development applications from residents looking to improve upon their own land holding,” she explained.
Buyers seeking a quick gain on the Central Coast should look to Gosford and Woy Woy in particular.
“If the Central Coast is on a client’s radar, we have a few key recommendations to them – look to Woy Woy and Gosford, and surrounding suburbs along the train line, as this area is well serviced for commuters into Sydney's CBD and also has good arterial road access to the M1.
“Buy in areas not reliant on tourism dollars or heavily populated by retirees – growth in these areas is slow. Check if the area is flood-prone or in a bushfire zone, and ensure the property is close to amenities, schools, public transport, etc,” she said.
With buyer activity on the Central Coast already having undergone a dramatic increase, Ms Vadillo said prospective investors should get in as soon as possible.
“We are seeing sales in this area taking place at the first open and generally just single digit days-on-market for the lower-priced houses,” she said.
Investors should target housing stock primed for renovation, or additional site modifications, to capitalise on local market conditions.
“With changes to investor lending and minimum deposit requirements rising, the double-your-deposit philosophy could be applied here, but it will take some smart and fast buying, and some elbow grease on a home than needs some cosmetic attention,” Ms Vadillo explained.
“The option to add a granny flat is becoming a big selling point for Sydney investors who are pushing the price up with the increased buyer demand on the area.”