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Sunday, 7 June 2015

Property boom - winners and losers

Winners, grinners and sinners

Neat piece from the Australian Financial Review this weekend (subscribers only).

Unsurprisingly, Sydney dominates the best performing suburbs list of the past three years.

It was pleasing to see Wollstonecraft up near the very top of Australia's best performers.

80 per cent of investment properties I bought for clients in 2013 and 2014 were in the suburb of Wollstonecraft.

I explained some of the reasons for this here in January 2014 (as well as here and here, and elsewhere).

Epping has seen some monster gains over the past 12 months a result of rezonings, an outcome I anticipated long ago as referenced in this article for the Australian Financial Review itself.

At the morose end of the spectrum, I have warned repeatedly that the planned 2017 closure of the Holden plant in Adelaide would cause some serious botheration for real estate prices locally.

Munno Para has seen median prices plummet by more than 26 per cent, while house prices in Munno Parra West have fared slightly "less worse" at negative 5.5 per cent growth.

In terms of nearby suburbs, Blakeview prices have dived by 10.6 per cent, and in Smithfield Plains median prices are 10.3 per cent lower over the past three years.

At the epicentre of the motor industry malaise, Elizabeth has consistently experienced the highest capital city unemployment rate in the country at well over 30 per cent, so it is no surprise that prices have been sliding in those suburbs too.

A consequential opportunity cost there.

Some mining regions have fared much worse than even this, despite record low interest rates, but the AFR article was understandably focussed upon capital cities.