Monday, February 12, 2007

Look on the bright side and you’ll find a real-estate hot spot

Date: February 6, 2007
Publication: Sydney Morning Herald
Author: David Potts
Still, it’s not bleak everywhere. While it might be going a bit far to talk about hot spots, there are certainly some thermal springs around.
One of which isn’t Perth, the star performer of recent years thanks to the resources boom.
“The next year for the west coast will look very different,” Rod Cornish, head of property research at Macquarie Bank warns.
While prices in the outer suburbs are expected to drop, others will “revert to the long-term average this year” - which will still be quite a slowdown.
Where will this year’s winner be then?
Adelaide, says Michael McNamara of Australian Property Monitors.
You’re not the only one who didn’t pick that. Just remember you read it here first, and possibly last. It’s not as if Adelaide prices have been shooting up while we weren’t looking, but they’ve certainly been rising.
“It’ll be the star performer of all the capitals,” McNamara says. “It’s only had modest growth despite its proximity and the resources boom.”
As well, the Adelaide-Darwin rail link, he predicts, will “boost the military infrastructure”. And even though Perth and Darwin have shot ahead, Adelaide “is so well located for mining executives who want easy access to Mount Isa, Broken Hill, Olympic Dam and Perth,” he adds.
Parts of Sydney and Melbourne - the top end, inner city and beach suburbs where there tend to be “supply issues” - are also tipped to do well in the next year or so. But the most other, more interest-rate sensitive, suburbs can expect is stagnancy.
The map below shows other hot spots identified by Australian Property Monitors. But I can let you into a little secret . . . you can still get a three-bedroom place with an ocean view for under $300,000 on the Bass Coast, east of Victoria’s Mornington Peninsula.
The mini metropolitan cities of Newcastle, Wollongong and Geelong also appear to be offering better value, having experienced lower price rises and having shown more resilience to the slowdown than in their nearby mother capitals.
And the gentrification of Fortitude Valley is one to watch in Brisbane.

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