- Some NSW and QLD suburbs are expected to hold up well even if a recession hits later this year
- Defensive property purchasing in times of uncertainty remains a smart strategy, say experts
- Burleigh Waters in QLD, Leichhardt in NSW, and Banksia Park in SA could hold their values well
Suburbs across NSW and QLD should potentially hold up well in the event that the Australian economy falls into rescission later this year according to an expert.
Hello Haus, Founder, Scott Aggett said, “There are some dire predictions doing the rounds with several economists predicting Australia could fall into a recession this year. While my own view is the economy is far more robust than some analysts would have us believe, defensive property purchasing in times of uncertainty remains a smart strategy.”
Despite property values declining by their largest margin since 2018, Mr Aggett believes that certain locations will continue to see price growth even in a recession.
Queensland hotspots
Mr Aggett said four south-east Queensland suburbs have shown to be resistant in light of the downturn, while four in New South Wales also showed strength.
Mr Aggett said Burleigh Waters was an appealing location on the Gold Coast.
“This Gold Coast hotspot location has been gaining prominence among prestige homebuyers of late. Rising net internal migration is seeing plenty of southern buyers flock to the area. For $1.4 million you can secure a renovated four-bed, two-bath, two-car lowset brick home on a 600 square metre lot.”
He also said Thornlands should hold its value in the coming years, “Located in Brisbane’s bayside and positioned 32 kilometres south-east of the CBD, Thornlands is a well-established suburb with Moreton Bay water frontage. A mix of planned infrastructure totalling over $300 million will be an economic and social boost to Thornlands and surrounding suburbs. At the median house price of $850,000 you can secure a good size four-bedroom home on 600 square metres of land.”
Other QLD suburbs include Burleigh Waters and Reedy Creek.
NSW suburbs to hold up
Meanwhile across NSW, East Albury has potential according to Mr Aggett.
“Located three hours’ drive from Melbourne, six hours from Sydney, nine hours from Adelaide and 3.5 hours from Canberra, Albury is positioned within relatively easy access to 75 per cent of the Australian population. There are myriad property types available for purchase from contemporary and established dwellings through to attached housing. The median house price of $700,000 would secure a lowset three- or four-bed, one-bath home on around 800 square metres of land.”
He said Leichhardt is a Sydney suburb that has a lot of upside.
“At a median of $1.725 million, Leichhardt offers a relatively low entry-level into the inner west of the Sydney property market. This suburb is positioned 6.5 kilometres east of the Sydney CBD and is set to benefit from billions in infrastructure spending including the $3.9 billion Rozelle interchange and the $750 million Royal Prince Alfred Hospital redevelopment. The median price of $1.725 million will secure an established three-bed, one-bath brick-and-tile home on a 300 square metre lot.”
Meanwhile, Banksia Park in South Australia was the only location selected outside NSW and QLD.
“Positioned 16 kilometres north-east of Adelaide’s CBD and set to benefit from over $6 billion in infrastructure spending, including the Adelaide Airport expansion, this suburb is dominated by 30-to-40-year-old brick homes on traditional size allotments. For $655,000 you can buy a three-bed, two-bath home on 700 square metres of land.”
Strong fundamentals
Mr Aggett said he was focused on areas where the proportion of resident homeowners exceeds 55 per cent of the suburb’s total population, median days on market of below 60 and a compound annual growth rate of more than six per cent.
He said it’s also important to look for areas with a vacancy rate below 2.5 per cent and a gross median rental yield of more than three per cent for properties under $1.5 million.
Mr Aggett said, “All the areas we’ve chosen are within a reasonable commute of a capital city or major population centre. We also sought locations where infrastructure spending would help drive the demand for property and inject dollars into the local economy.”
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Disclaimer: This article contains general information and should at no time be considered advice to the reader. The reader should always verify their situation with the relevant certified professionals before taking any further steps.
