Buying into an area as it’s about to bloom can be a fantastic opportunity, but as the real estate market seemingly has a life of its own, it can be tricky to predict where the next hot spot will emerge. If you’re looking to buy your first property or move from your current home, take note from savvy investors and keep an eye out for these tell-tale signs that indicate an area is about to take off.
Enter the builders
From abandoned warehouses and neglected blocks to old homes in desperate need of a makeover, many areas that have seen a huge surge in popularity emerged out of a shabby past. Keep an eye out for construction in less desirable suburbs, be it the remodelling of industrial spaces, the creation of green areas, or locals tidying up their homes, as they are good indications both the council and locals are investing into their area.
New kids on the block
Oftentimes, young people are priced out of established markets, leaving them with no other choice than to set up home in a more reasonably priced area. And the same holds true for artistic types. The huge upside to having these demographics settle into an area is that bars, restaurants and other businesses are sure to follow. They also bring an upbeat, creative flair that sooner or later will ripple out across the suburb and, before you know it, the next hot spot in the market will have been revealed.
Going, going, gone!
A sure-fire way of finding out if an area is on the rise is to window shop at local real estate agents. Charles Tarbey, Chairman of Century 21 Australia, says: “When an area is about to take off, agents will be marketing themselves strongly. You will also see an abundance of properties advertised in their windows with SOLD stickers.” Agents will also be able to share their knowledge of development plans, so it’s worth taking the time to speak to them about recent market shifts and planned movements.
At your service
Buying into an area lacking in amenities can be a risky business, so a visit to the local council to enquire about plans for developing new infrastructure or improving what already exists is essential. Services such as a public transport network, schools, medical facilities, childcare, supermarkets and other retail stores are basic needs that can make or break a suburb. Without decent infrastructure in the area, a property is much less likely to gain in value, which will make re-sale all the more difficult.
The tricky part about investing in an up-and-coming suburb is finding the sweet spot in timing. Many areas will only appear on the radar once they have started to take off, meaning you may have missed the window of opportunity to land yourself a profitable investment. But buying too early may involve a long waiting game and leave you living in an area you would rather not be in. So, when is the optimal time to buy? “When there is an abundance of property on the market,” says Mr Tarbey. “In a buyers’ market, your ability to negotiate improves dramatically.”