1.Consider taking your search interstate.
Wouldn’t it be so convenient if the next diamond in the rough were just around the corner from you? While its not an impossibility, it’s unlikely a reality. A huge advantage to looking outside of your locality is that it forces you to think sensibly and focus on statistics and growth drivers as opposed to insignificant emotional things, like how much you hate the kitchen. Sourcing a buyer’s agent could be your best bet if you’re worried about venturing into the unknown.
2.Examine the supply and demand.
Its important to know the area you are looking in has a low vacancy rate, so you get a better idea on whether or not you’ll be able to lease your property. Speak to local real estate agents to get an accurate representation on vacancy rates. Other great indicators of supply and demand are auction clearance rates, amount of days a property stays on the market before it is sold, amount of property on the market and the owner-occupier to renter ratio.
3.Keep an eye out for warming signs.
Some tell tale signs of an up and coming suburbs are new cafes opening, renovations to existing properties, subdivision projects with a few townhouses going up on one site, increases of prep children being enrolled at local schools, slowly getting rid of service provider shops like Laundromats, to make room for cafes and boutiques.
Look into the future infrastructure growth in the area.
New, or improved bus and rail links and roads can add enormous value to a suburb. If the government plans on such developments , it is a great indicator they expect a big growth in the area, which in turn, is a dead giveaway property prices, will increase too with the demand. Other things to look out for are new schools, medical facilities and shopping centers. All this information on proposed developments is available online, through the councils website.
5.Research the growth.
Think about the ripple effect. Generally, the suburbs that have experienced the highest surge in prices are 10km from the CBD, or along the coastline. Have a look at adjoining suburbs, which have not yet experienced that surge. Also monitor the next set of suburbs out from there, as the ripple can often be felt further than the immediate neighbours. Identifying the primary growth drivers is crucial to using the ripple effect to your benefit.
6.Consider the clientele.
What is the median age of the population in the area you are looking to purchase? If they are in their 40s, and there are lots of schools in the area, you might be best to purchase a 3-4 bedroom home. If the area has 30 year olds and lots of cafes and bars in the area, a townhouse or apartment might be better investment. You can find information on median age, and average household income statistics on Australian Bureau Of Statistics site.