With the Sydney and Melbourne markets now sitting towards the bottom of their cycles, and Perth not too far ahead, investors have increasingly looked towards regional markets over the last 12 months. The top performing regional markets of late have included Geelong, Sunshine Coast and Launceston to name a few.
Some investors have turned their noses up at regional markets in the past, with the often-cited expectation that the best capital growth is achieved only in capital cities proved incorrect with many of Australia’s best performing markets of the last 20 years being regional. To put this into perspective, 7 out of the 10 most expensive cities for property now live in regional areas like NSW’s Byron Bay, Kiama, Wingecarribee, Wollongong and Ballina.
Given the lending conditions and increased scrutiny towards living expenses and personal cashflow, rental yield now more than ever is becoming increasingly crucial to building on one’s existing property portfolio or getting off to a sustainable start in commencing the acquisition stage. Whilst not always the case, the propensity of a rental yield being higher is more commonly the case in a regional market, rather than a capital city.
Rental yields however shouldn’t be relied upon as the only source of information to select a prosprous regional market. Factors such as a diverse economy will prove integral to the long-term performance of a market as this translates into new job availability, wage growth, supply to demand of existing properties, rental demand, and rent increases to name a few. Key industries to look out for when selecting a market include; Tourism, Agriculture, Education, Health and Retail.
DPN, a leading property investment advisor has identified the lifestyle cities of Coffs Harbour, Ballina and Port Macquarie as new growth areas you should keep an eye on, with information from the ABS, RP Data Core Logic, RESIDEX and the NSW Government. Here’s why they’re attracting property investors.
Coffs Harbour
Coffs Harbour is undergoing a population boom, with hospital upgrades, recreational facilities and investment in the arts steadily on the rise. Two significant projects include a $38 million upgrade to the Coffs Harbour Hospital and $10 million of State Government funding invested in the Coffs Coast Regional Sports Hub. Recently, the Jetty 4Shores project took out top honours in the Australian Institute for Architects NSW Country Division Awards.
Ballina
Sustained job growth and community infrastructure lead the way in Ballina’s transformation as an investor hotspot. Ballina District Hospital is undergoing a $6.9 million upgrade and improvements to the Pacific Highway to Woolgoolga are 50 per cent complete. Furthermore, a $30 million shopping centre is approved for the nearby Epiq community in Lennox Head.
Port Macquarie
Tertiary students and young families are set to flock to Port Macquarie. The $40 million stage two expansion to the Charles Sturt University is projected to increase student numbers by 840. Funded by both the NSW and Australian Governments, the Port Macquarie Airport Terminal Building is receiving a $9.875 million facelift. Further increasing job growth and community services, progress on the retail hub, Sovereign Hills Estate Town Centre, is in full swing.
In recent years, investors have also reported great results in other booming coastal cities, including Geelong, Newcastle and Wollongong.
For more comprehensive information on the property investment potential in these areas see DPN’s article: Coastal Property Hotspots: where the investors are buying.
You can contact DPN for investment opportunities in Ballina, Coffs Harbour and Port Macquarie.
As with all potential property acquisitions, make sure you review your investment strategy and ascertain how this is going to fit into your current plan of attack and contributes towards your end goals, which for many property investing Australians is achieving a passive income.