Newcastle August 2017

The month in review: Newcastle

By Herron Todd White
August 2017

Owning your own home is the great Australian dream, but what about owning two homes, three homes or even more? Investing in real estate has always been a popular way of earning an extra income in Australia and with over 50% of residential sales in the Lower Hunter in the past financial year being to investors, this region is certainly a hot spot for property investment.

The number of investment home loans has dropped nationally over the past year and this trend is predicted to continue due to the regulatory clampdowns that have been imposed. These regulations and the government’s efforts to cool the housing market especially in major cities would suggest that investment should slow down nationwide.

This may not be the case in the Lower Hunter however; in fact it will probably buck the trend. Newcastle is still an enticing prospect for investors due its close proximity to Sydney, its affordability compared to the capital cities and an excellent rental market with a current vacancy rate of just 2.3%.

With Newcastle being a university city there is a high investor involvement in good rental yield suburbs close to the university such as Jesmond and Wallsend. However investors are also looking at inner city and coastal suburbs such as Cooks Hill, Wickham and Adamstown for higher capital gains.

The Newcastle CBD is undergoing a makeover and with the construction of not only a new university campus but also numerous apartments, the area is sure to see an influx of investment in the near future.

Strong rental returns, larger blocks, competitive capital gains and the ability to find low maintenance 2- to 3-bedroom properties for under $500,000 means the region offers plenty of good investment opportunities for those who can’t afford the larger capital cities, especially Sydney.

There is something for every type of investor: more expensive coastal properties, inner city properties, student accommodation, fixer uppers and larger family homes in the outer estates and suburbs. Savvy investors continue to see good returns in Newcastle and the investment market shows no signs of slowing down.

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