The golden rule in real estate is “location, location, location”, but how do you know a suburb is right for you when you find it?
Whether you are buying an investment property or a home, finding an area that meets your needs is paramount. Here are some things to consider when deciding on a suburb.
Access to amenities
In terms of lifestyle appeal and future potential capital growth, one of the key things to look out for is access to amenities. You’ll want to know there are things like schools, hospitals, shopping centres, parks, bike trails and walking tracks in the neighbourhood.
If you’re buying a home, having amenities nearby will make life easier and more enjoyable. As an investor, these kinds of features will also be a drawcard for prospective tenants.
It’s a good idea to pay particular attention to the local school catchment area. This can affect not only the capital growth potential of your property, but also its rentability.
Which public schools is the area zoned for and what’s their reputation like?
Are there private schools nearby that are highly sought after?
Even if you don’t plan on having kids, you may want to rent out your home to a family one day and being close to reputable schools could make your property more appealing to them.
Anyone who has ever commuted to work on public transport understands the importance of having efficient public transport close to home. Check the local bus routes and train lines when doing your suburb research.
If there are limited public transport options nearby, at the very least make sure the property is well connected to major roads and freeways.
Future planning and zoning
Proposed infrastructure changes and large-scale residential developments could have a significant impact on the value of your property and its rentability – think suburbs that become saturated with townhouses and multi-storey apartment blocks.
Research whether there are any zoning changes looming or major government projects in the pipeline that could affect the suburb’s desirability.
Infrastructure investment in a suburb can help drive up property prices. However, as an investor, it’s also important to stick to suburbs with a strong record of population growth, not just mass development on the horizon.
Rental market returns
As an investor, look into the rental yield, which is a measure of how much cash an income-generating asset produces each year as a percentage of the property’s value (note: there are gross and net yield calculations to consider).
It’s also a good idea to look into vacancy rates and the demographics of the suburb. What proportion of inhabitants are renters? This may help give you an indication of the level of rental demand within the suburb.
Future price growth
If capital growth is on your radar, look for indications property values may increase.
What do the historical capital growth trends tell you?
Is there likely to be population growth in the area in coming years? Are there employment opportunities nearby?
Are neighbouring suburbs highly sought after or is the suburb being improved or “gentrified” by new residents?
Are vacancy rates low?
How many days are properties on the market and are vendors discounting?
This kind of research will help give you a clearer understanding of the local market and how the suburb is faring.
Tips for doing your suburb research
A good way to better understand a suburb is to spend time there before purchasing. Drive through the neighbourhood at different times of day and speak to the locals about what it’s like to live there.
However, the absolute easiest way to access all the information you need is to ask us for a free suburb report. It includes the latest details about everything from demographics and the volume of properties in a suburb, to current listings, recent sales, median property values and more.
Get in touch today for your complimentary property report.