Bargain investments under $500,000

Bargain investments under $500,000

Posted on Thursday, May 03 2012 at 12:32 PM

Following a cooling-down period, Brisbane, the Gold Coast and the Sunshine Coast currently offer the greatest bargain shopping for astute investors, with the ability to potentially secure two rental properties on a $500,000 budget, according to a recent national property report released by Herron Todd White and Westpac.

API has provided a summarised
version of the national report below.

New South Wales

Even in high-priced Sydney,
suburbs in the west like Parramatta and Auburn offer units with a $370,000
price tag and gross rental yields of up to 5.7 per cent, the report says.

For longer-term capital growth
in Sydney, investors should look at stable inner-ring suburbs like Neutral Bay,
Leichhardt and Randwick.

In the Newcastle/Hunter region,
suburbs in close proximity to major Newcastle hospitals or the University of
Newcastle are considered strong investment options due to healthy year-round
tenant demand. Waratah, Jesmond and Shortland are perfect examples of this.

Further west, Singleton,
Rutherford and Aberglassyn are all areas demonstrating rental growth from the
strengthening mining sector, according to the report.

Other NSW hotspots under
$500,000 include: Gosford, Wyong, Forster, Taree, Kempsey and Port Macquarie.


For gross rental yields up to 17
per cent investors can pick up a property in Chinchilla, though such
investments are deemed “highly speculative”.

The report highlights the
Brisbane suburbs of Mitchelton, Keperra and Kedron for astute buying, all
located within 10 kilometres of the CBD with gross rental yields around five
per cent.

The Gold Coast is bargain buying
central right now. The report highlights three-bedroom townhouses in the
Oxenford/Coomera area, one-bedroom units in the Southport/Surfers Paradise area
and a duplex pair in the Southport/Labrador area “with the land component of
the property adding to potential for long-term capital growth”.

Also on the Gold Coast, suburbs
such as Parkwood, Molendinar and Arundel should expect reasonable capital
growth given their proximity to the new Gold Coast University Hospital and
Griffith University.

On the Sunshine Coast, the
Kawana strip, Maroochydore, Mooloolaba and Caloundra all offer investment
opportunities under $500,000. Construction of the Sunshine Coast University
Hospital is scheduled to start next year.

Other bargain Queensland
hotspots include: Toowoomba, Moranbah, Gladstone, Mackay, Rockhampton,
Bundaberg, Hervey Bay, Townsville and Cairns.


In Melbourne, Footscray is the
place bargain buyers should head to, as significant urban renewal is under way.
Houses are still available for around $500,000 and there’s a healthy supply of
apartments for around $310,000, Herron Todd White chief executive officer Gavin
Hulcombe says. Units in St Kilda East are another option.

Other report hotspots include
Geelong, Bendigo and Ballarat.

South Australia

Over the border in Adelaide,
Hulcombe picks the suburbs of Flinders Park and Torrensville for good bargain

Other Adelaide suburbs highlighted
include Norwood and Parkside. Regional areas highlighted include Victor
Harbour, Goolwa, Robe and Beachport (with ocean views and strong potential for
long-term gains). Roxby Downs, Whyalla, Port Pirie and Port Augusta are also

Western Australia

In Perth, the report highlights
inner-city apartments generating gross rental yields of six per cent as a good
option for investors. It also mentions four-bedroom houses in established
suburbs of Willetton, Bassendean and Ocean Reef due to their close proximity to
the CBD, quality schools and local amenities.

Joondalup City Centre apartments
are achieving five to six per cent gross rental yields, with potential for even
higher yields as the northern corridor is expanded and the Joondalup Town
Centre continues to develop.

Other WA hotspots outlined
include South Bunbury, Bunbury, suburbs north of the Bussel Highway from Abbey
to West Busselton plus Dunsborough, Dalyellup, Millbridgewith and Kalgoorlie.

Northern Territory

In Darwin it’s still possible to
pick up apartments in a city fringe suburb like Larrakeyah for under $500,000,
Hulcombe says. “But with an influx of workers expected once construction begins
on the new Inpex LNG (liquefied natural gas) plant, Darwin prices look set to
climb again and investors could be the key beneficiaries.”

Another option in the NT is
Katherine – a more affordable option to Darwin with gross rental yields
achievable at six per cent.


Venture down to
Tasmania and investors can expect to easily pick up a quality house for under
$500,000 across most of the state, with plenty of spare change. This excludes
the more prestige suburbs of Sandy Bay, Battery Point and central Hobart, said

The report
highlights the following suburbs as good investor hotspots: Launceston, Burnie,
Devonport. In Hobart: Sandy Bay and Newnham.

This information is of a general
nature only and does not constitute professional advice. You must seek
professional advice in relation to your particular circumstances before acting.


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