Inner City Apartment Opportunities

For those seeking apartments as an investment, there are plenty of suburbs close to the CBD of Sydney and Melbourne that provide great opportunities.
 
Senior economist Dr Andrew Wilson at Australian Property Monitors says while capital growth is a key driver, yields and vacancy rates are also important factors especially when first entering the market.

In Sydney, Dr Wilson suggests inner-western suburbs such as Glebe and Ultimo represent traditional hunting grounds for investors and for more affordable entry points the inner south.  For rental yield, Surry Hills, Darlinghurst and Alexandria all stand out due to demand to live here.

Nick Viner of Buyers domain adds suburbs such as Randwick, Erskineville and Annandale to the list.

While he points out buying established can often get you bigger floor plans and more boutique projects, off the plan provides great opportunities for depreciation, potential for higher rents and better layouts. 

In Melbourne, Dr Wilson advises investors to consider suburbs such as Richmond, South Yarra or Brunswick over central city where apartments where there is a current oversupply. 

Buyer’s advocate Frank Valentic points to the inner north, including Northcote and Thornbury and inner west Footscray and Seddon as good hunting grounds for investors.  

Mr Valentic strategic investment advice is it’s better to buy two more affordable ones than one expensive one to spread your risk.  A location such as Carlton close to a university may be a better first investment given demand for rentals versus South Yarra, although wont experience the same capital growth. 

The five best suburbs for apartments in Melbourne 
– Suburb/median price/annual median growth*/gross rental yield**


Hawthorn

$480,000

16.5%

3.9%

Prahran

$497,500

13.8%

3.9%

South Yarra

$520,000

9.5%

4.0%

Port Melbourne

$632,300

8.1%

4.1%

St Kilda

$450,000

4.7%

4.3%


* Suburbs with more than 60 sales
** Based on six months to the end of September
Source: Australian Property Monitors
 
Published on 12th of June 2015 by Marty Stanowich
Marty Stanowich
Marty Stanowich

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