© Property Professor articles — www.thepropertyprofessor.net.au.
Reproduced with permission.
In this series of articles, I have outlined some of my “Golden Rules for House Hunting”. So far, we have looked at Rules 1 and 2:
1. Buy the worst house in the best street.
2. Look for streets with redeeming features.
This week we look at my third rule:
Golden Rule #3 – Look for improving areas with easy access to the city/beach/facilities
What we are trying do is look for areas which are going through the ‘gentrification’ process. That is, suburbs that were run down, undesirable and had depressed property prices but due to a number of factors, have regenerated, are now popular and property prices have increased substantially. Suburbs that have already gone through this regeneration process include Balmain and Paddington in Sydney, Richmond and St. Kilda in Melbourne, West End in Brisbane and Henley Beach in Adelaide.
Buying into an area that is improving can accelerate your wealth creation; buy in at a relatively cheap price and ride the wave of capital growth!
Some of the signs that an area that is improving include:
• The main shopping strip is being upgraded. Evidence of this includes resurfacing of the road, repaving the footpath, installation of benches, trees and lighting. A median strip might also be installed and planted out with bushes and trees.
• What were previously empty and derelict shops have been bought/leased and are now trading.
• Shop fronts are being updated with a coat of paint, new sign writing in the windows and a cleanup of the footpath outside the shop.
• You see more café umbrellas, tables and chairs as people are now willing to spend time in the main shopping strip as it is a more pleasant environment.
• Bus stops are virtually graffiti free and the shelters are not vandalized.
If you move off the main shopping strip and travel down the side streets, some of the signs of gentrification you could see include:
• Character/period houses are being renovated. This includes gardens being replanted and houses have a fresh coat of paint.
• New home owners are also spending money on extensions and building new living area(s), kitchen and bathroom.
• Government housing is being upgraded. Existing homes are either being refitted or knocked down and new homes are constructed in their place.
• Streets and footpaths are being resurfaced and the local Council is also planting trees and installing new lights.
• Playgrounds have new equipment and are frequented by families. They are no longer the hang outs of gangs who graffiti and damage the equipment.
I have included 10 signs of an area going through the gentrification process. There are many more. The best way to determine if an area is improving and worthy of your investment dollars is to go and see it for yourself.
Happy House Hunting!
Written by Peter Koulizos, university lecturer, author and buyers advocate.