Investors are being urged to avoid buying homes in several cheap suburbs on the outskirts of Australia’s capital cities.
Some outer suburbs in Brisbane, Perth and Darwin would be unlikely to see capital growth, modelling by real estate advisory group Empower Wealth shows.
Properties in some of these areas are selling for less than $400,000 and are a long drive from the city centre.
A Brisbane suburb with low growth is Bahrs Scrub near Beenleigh. Properties in this area of Logan are being advertised for less than $400,000, which is significantly below Brisbane’s median house price of $531,000 (pictured is an aerial view of Brisbane’s city centre and nearby New Farm)
The Perth locations investors should avoid are the outer suburbs of Henley Brook, Wandi and Jindalee, as well as the middle-ring suburbs of East Cannington and Bentley (pictured is an area of inner Perth)
In Brisbane, investors have been warned to stay way from Bahrs Scrub near Beenleigh, which is 38km south of the city.
WHAT CAPITAL CITY SUBURBS SHOULD INVESTORS AVOID?
- Perth: Henley Brook, Wandi and Jindalee, as well as the middle-ring suburbs of East Cannington and Bentley
- Brisbane: Bahrs Scrub near Beenleigh area south of the city
- Darwin: Rosebery, Farrar and Howard Springs all located in the wider Palmerston area
Properties in this area of Logan are being advertised for less than $400,000, which is significantly below Brisbane’s median house price of $531,000.
In Perth, suburbs to avoid include Henley Brook, Wandi and Jindalee, as well as the middle-ring suburbs of East Cannington and Bentley.
During the past year, Perth’s median house price has plunged by 8.7 per cent, CoreLogic data shows.
Darwin suburbs regarded as risky include Rosebery, Farrar and Howard Springs, in the satellite city of Palmerston.
Median house prices in the Northern Territory capital dived by 6.4 per cent in the year to the end of May.
During the past three years, Darwin’s median house price has fallen by 12 per cent, with the suburb of Rosebery falling 17 per cent.
The Darwin suburbs to avoid buying property are Rosebery, Farrar and Howard Springs which are all located in the wider Palmerston area (pictured is Darwin’s city centre)
Jeremy Sheppard, the research director of Empower Wealth, urged investors in these suburbs to sell their properties immediately, arguing demand would be unlikely to recover.
A TALE OF EIGHT CITIES
Sydney, down 11.6% to $869,579
Melbourne, down 12.6% to $708,523
Brisbane, down 2.3% to $531,047
Adelaide, up 0.2% to $465,625
Perth, down 8.7% to $459,823
Hobart, up 3.8% to $478,485
Darwin, down 6.4% to $462,984
Canberra, up 3.4% to $658,407
Source: CoreLogic median house values in the year to May 31, 2019
‘The research showed that vainly holding on to properties in some of these locations could see your property wealth erode every year,’ he told realestate.com.
He advised investors to buy in lower-priced suburbs in Adelaide, Hobart, Canberra and the Gold Coast-Tweed area to reap capital growth.
‘The Canberra-Queanbeyan region has taken out the first and second places for forecast price growth, partly due to affordable house prices close to our nation’s capital,’ Mr Sheppard said.
‘Both Charnwood and Karabar are near Canberra, which means housing is in strong demand from public servants.’