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Property investment expert's top three Sunshine Coast picks and why they will keep firing

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With interest rates at historic lows, vacancy rates extremely tight and rents on the rise, experts say there’s never been a better time to buy an investment property on the Sunshine Coast.

House prices are rising by 1-2% per month in most capital cities, with listings throughout Australia down 20% year on year, while buyer enquiry is up 8% over the same period.

Despite recent price rises, there are still good investment opportunities within suburbs which were in high demand with renters, according to property investment expert, James Fitzgerald.

His top three picks on the Sunshine Coast were: Caloundra, Sippy Downs and Birtinya, and he said those looking to invest or increase their portfolio should do it this year.

“The cost of borrowing money to buy is half what it was at this time last year,” Mr Fitzgerald said.

“The Reserve Bank of Australia has already said it won’t increase interest rates again until 2024 at the earliest so it’s an ideal time to invest.

“If you’ve got a bigger budget to work with, Birtinya ($745,000) is Mr Fitzgerald’s top tip.

“The thing I like about Birtinya is it has the hospital and sits right on the light rail extension, as well as having great amenity and proximity to the beach, airport and new town centre,” he said.

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“Healthcare will be Australia’s biggest employer over the next decade so that’s a big plus for me.”

“I’m also very keen on Caloundra as an investment hotspot, obviously some of the streets right on the beach are expensive, but there are others just a few minutes’ drive or walk that are still reasonably priced and it has a lot going for it and a lot of potential future price growth.

“The light rail is going to bring on a lot of house price growth, much like we saw on the Gold Coast.

“It has plenty of amenities for families including beaches, parks, cafes, restaurants, shopping and schools.”

The median house price in Caloundra was $575,000 and vacancy rates just 0.4 per cent, making it extremely difficult to find a vacant rental property there.

Weekly median asking rents for houses have increased by 11.5 per cent in the past three months to $554 per week.

Slightly more affordable Sippy Downs ($533,250) is another investment hotspot with high demand and extremely low vacancy rates of just 0.6 per cent.

“It’s in great proximity to the university and is an affordable area with highway access that will benefit from the new Maroochydore CBD which is forecast to bring in 15,000 jobs.”

“Vacancy rates in both of Caloundra and Sippy Downs have dropped substantially in the past 12 months to just 0.4% and 0.6% respectively,” Mr Fitzgerald said.

Median asking rents for houses in Sippy Downs have increased 6.7 per cent in the past three months to $626 per week.

“Sippy Downs and Caloundra in particular fit the investment profile which we recommend in Custodian’s 7 Steps to Wealth, which is to buy land,” Mr Fitzgerald said.

“Land is what increases in value so this is the most important part of your purchase.

“Obviously, you’ll need to build a house on it to rent out for cash flow but building new also gives investors great potential benefits such as tax depreciation.”

Mr Fitzgerald had already followed his own advice and bought land in Pimpama, which he is currently building a rental property on.

“When I’m personally looking to build a portfolio of investments, I’m looking for a bit of cash flow and population growth,” he said.

“These are my top Sunshine Coast areas because they are affordable, the rental yields are strong, and their population is growing.”

  • Caloundra: house median $575,000, vacancy January 2020 1.1%, vacancy January 2021, rental yield 0.4% 3.89%
  • Sippy Downs: house median $533,250, vacancy January 2020 1.6%, vacancy January 2021 0.6%, rental yield 4.78%
  • Birtinya: house median $745,000, vacancy January 2020 1.6%, vacancy January 2021 0.5%, rental yield 3.84%

 

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