5 locations first-time investors should consider

Sep 2021Karen Millers

First-time investors who would like to get their slice of the property market while it’s hot should consider breaking into locations with an affordable entry point and strong economic conditions.

Grant Foley Property director Grant Foley said property investors are starting to look away from Sydney and Melbourne, where entry-level house prices are already above $1m.

“Two-thirds of our population live outside of these two capital cities, where purchase prices are more affordable and often in places where there is excellent potential for value uplift over the medium- to long-term,” Mr Foley said.

Mr Foley identified five locations where first-time investors can start or grow their portfolio.

These include Moreton Bay, Ballarat, NewcastleAdelaide, and Perth, which all have established freestanding houses under $650,000, a perfect price point for up-and-coming investors.

Take note, however, that according to the latest data from Real Estate Investar, Perth’s latest median house price is at $775,000.

Rise of regional locations

Mr Foley said the Moreton Bay region was experiencing ripple growth from Brisbane City Council suburbs as first home buyers sought more affordable housing options.

It is no surprise that a location in Brisbane is Mr Foley’s top choice.

In fact, a recent survey by the Property Investment Professionals of Australia (PIPA) showed that three in five investors think Queensland and Brisbane have the best investment prospects over the year.

“The region is also benefitting from strong interstate migration, as well as myriad major infrastructure projects including transport nodes and a new university – with gentrification of the Redcliffe peninsula also under way,” Mr Foley said.

Ballarat is also a top spot for would-be investors.

The regional towns selling point is its short proximity to the Melbourne CBD — just 1.5 hours’ drive away.

“More and more investors are recognising the potential of major regional locations such as Ballarat that have diverse economies as well as being within an hour or two of a metropolitan area,” Mr Foley said.

For those looking for a place that can be considered as an alternative to Sydney, Newcastle is the way to go.

Mr Foley said Newcastle has always been a go-to destination for homebuyers and investors who wanted to capitalise on the hot markets of New South Wales.

“Newcastle has reinvented itself from a former steel city to a lifestyle location that boasts amazing beaches, jobs in health and education, as well as being within commutable distance to Sydney for those working in the Harbour City a day or two a week,” he said.

Capital cities hold up

Among capital cities, Mr Foley identified Adelaide and Perth as the only two worth considering for first-time investors.

Mr Foley believes what makes Adelaide a viable place is its sustainability over the years.

Investors who find comfort in safety should consider getting into the Adelaide’s housing market given that it does not necessarily experience booms or busts.

“The buy-in price for a house in the City of Churches remains affordable for buyers and investors alike, including potentially purchasing in its investment grade middle-ring, which is not an option in most other capital cities,” he said.

Perth also appears to be holding up. Pre-pandemic, Mr Foley said there was not much happening the city.

“There was a point in time when the Perth median house price was on par with Sydney, which most people have forgotten about,” he said.

“Prices peaked in 2014 but there are signs that indicate future price growth in Perth with the opportunity to still secure freestanding homes for less than $650,000 there.”


Gerv Tacadena, Your Investment Property, 24 September 2021

We strive to bring accountability, ethics, and education to the property investment industry.

PIPA exists to improve the professional standards of anyone providing property investment advice to consumers. Our voluntary Code of Conduct means that members adhere to a high set of professional standards to help protect consumers. Qualified Property Investment Advisers (QPIAs®) have the highest form of industry-recognised, specialist training and can be trusted to provide tailored and unbiased advice to consumers.

PIPA also regularly produces research, analysis, and publications to help educate our members, media, and consumers about the property investment sector.

By signing up for our newsletter, you will gain access to two of our most valued resources – the Annual Investor Sentiment Survey report and the quarterly PIPA Adviser e-magazine.

2023 Investor Sentiment Survey

The Annual PIPA Investor Sentiment Survey is a rare snapshot of the buying intentions of property investors.

PIPA Adviser Magazine

The PIPA Adviser provides the latest research on market conditions, including forecasts for next year.