Gen Yers who continue to rent have many property investment options under $300,000: John McGrath

By Larry Schlesinger
Tuesday, 03 April 2012

John McGrath says RP Data figures showing suburbs with median dwelling prices under $300,000 confirm that Gen Yers can buy an investment property in a cheaper suburb and rent in a more desirable lifestyle location.

McGrath, CEO of McGrath Estate Agents, was one of the first market commentators to notice that more first-home owners are entering the market as investors and believes that renting while investing is entirely doable if a buyer is on a good income.

“For enterprising Gen Yers who don’t want to give up their lifestyle in trendy inner-city suburbs, many are buying investment properties in cheaper areas so they can get a foothold in the market without compromising on where they live – a clever tactic,” says McGrath, CEO of McGrath Estate Agents, in a blog post on www.switzer.com.au.

“At the end of the day, the key to buying on a budget is knowing where to look.

“Here are the top five suburbs in every capital city and regional areas where the highest number of sales under $300,000 were recorded between January and today. Note that all these suburbs recorded both apartment and house sales under $300,000.”

Sydney

Liverpool, Blacktown, Mount Druitt, Penrith, Lakemba

NSW

Dubbo, Orange, Goulburn, Port Macquarie, Taree

Melbourne

Werribee, Pakenham, Frankston, Melton South, Hoppers Crossing (You can buy apartments under $300,000 in Melbourne city (300+ sales since Jan 2011) but not houses)

Victoria

Mildura, Shepparton, Traralgon, Horsham, Sebastopol

Brisbane

Caboolture, Deception Bay, Woodridge, Redbank Plains, Eagleby

Queensland

Maryborough, Newtown, Warwick, Harristown, Gympie

Perth

Armadale, Rockingham, Gosnells, Maylands, Mandurah

Collie, Boulder, Northam, South Kalgoorlie, Katanning

Adelaide

Morphett Vale, Paralowie, Salisbury North, Parafield Gardens, Salisbury East

Mount Gambier, Murray Bridge, Port Lincoln, Whyalla Stuart, Whyalla Norrie

Hobart

Glenorchy, Claremont, Kingston, Moonah, Brighton

TAS

Devonport, Ulverstone, South Launceston, Newnham, New Norfolk

Darwin

Bellamack, Johnston (no apartment sales), Farrar, Rosebery, Nightcliff

Canberra

Casey (no apartment sales), Crace (no apartment sales), Forde, Bonner (no apartment sales), Macgregor

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written by 2020fp, April 04, 2012

I would like to know how much thought or research/investigation that John McGrath or Property Observer has completed on the Adelaide market in providing this article, other than reading RP sales data. The areas listed Morphett Vale, Paralowie, etc. are in lower socio-economic zones, have a large amount of housing trust properties, higher levels of unemployment & in some areas crime rates, drug problems or home invasions which are > than the state average. The properties are therefore cheap for a reason & not necessarily good buys for Gen Y people (who would be seeking good levels of rental income, minimal tenant hassles & future capital growth). There would be suburbs near these locations that whilst offering higher purchase prices, would offer far better prospects of gaining better standards of tenants & likely future capital growth.