Regional SA August 2017

The month in review: Regional SA

By Herron Todd White
August 2017

Mount Gambier

Investor interest in the Mount Gambier region has been relatively good in recent years. A range of property types, such as units, maisonettes and house and land packages in modern divisions, appeals to investors in the area Local and out of town investors are purchasing properties in Mount Gambier.

Local investors typically spend less on a property and will generally lean towards units rather than house and land packages. In comparison, out of town investors often have larger budgets and will invest in properties that provide good yields, such as flats or house and land packages. Local investors generally look at properties in the mid range whereas out of town investors look at properties in the low or high range.

In recent years there has been limited capital growth in the Mount Gambier region. However, in comparison to cities and other regional areas, the returns on properties within the region are considered quite good and are therefore attractive for investment properties.

New modern divisions have been targeted by out of town investors in recent years. These modern divisions have had bigger marketing campaigns that purely focus on drawing in investors.

In recent years the number of unit sales occurring has been increasing and in 2016 unit sales were almost double what they were in previous years. As seen in the graph below, last year there were 98 unit sales, whilst in 2013 and 2014 there were only approximately 50 unit sales. A high percentage of these unit sales tends to be to investors.

Investors are generally seen as a positive for the Mount Gambier region. With the recent creation of the James Morrison Academy of Music, there has been more interest from investors because there are more people looking for rental properties.

If investor activity were to slow within the Mount Gambier region we do not consider this to significantly impact the current market. There would likely be a bigger impact if investors were looking to exit the market altogether, as this could create an oversupply of properties.

If we could give any advice to investors who are thinking of buying in the Mount Gambier market, it would be to do your research on locations and look deeper than just the yield. It would be beneficial to look at the local industry and employment within the region and also the health of the local economy.

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DISCLAIMER: The information contained in this article is correct at the time of publishing and is subject to change. It is intended to be of a general nature only. It has been prepared without taking into account any person’s objectives, financial situation or needs. Before acting on this information, Smartline recommends that you consider whether it is appropriate for your circumstances. Smartline recommends that you seek independent legal, financial, and taxation advice before acting on any information in this article.