“So mum, what town is your next property development going to be in?” asked my 12 year old son. He’d just returned from a school excursion to Canberra, so maybe he was checking out land as he glazed out the bus window?
I was excited to have a question from him that actually related to property. I’d been drumming into the kids the benefits or property investing since they were toddlers. They’ve both come on my development site inspection trips (bribed by a promise for lunch at McDonalds). They’ve been photographed under a street sign that was named after their mum and occasionally I wondered whether any of what I did was sinking in.
But when my son asked this question I smiled because it’s actually a really good question. I’d been mulling over this recently. You see Property Bloom has been looking at widening the areas where we work and this is because there are some economic conditions changing right now in some locations around the Hunter that are specifically linked to mining.
On that subject, I was interested to see this week if our new Prime Minster would be successful in scrapping the Carbon Tax as promised. But on Wednesday, Tony confirmed he hadn’t yet as Labor continued to block it. So we may need to wait until the new senate convenes 1 July 2014 to see things change. The flow on effect may not be seen in the mining industry to later in the year. These are all fundamentals us property investors need to be aware of.
Whilst Property Bloom has been active in the major Hunter coal mining towns, most of our business is still being done in more diverse Hunter cities. I always come back to the original city I started working in, and still develop in after twelve years. This town has a population of over 53,000 and has grown year on year for the past ten years. It has a diverse economy, good employment prospects, is affordable with good rental demand. The capital growth predictions are healthy. Whilst some properties are selling quickly in this city, it will benefit from the “flow on effect” to come.
We are seeing quite a lot of heat in Sydney right now. I’ve been getting calls from investors trying to get into the more affordable areas of Sydney but who are constantly missing out on purchasing and reporting properties selling way over expectations. This is making investors start to look at a wider radius around Sydney – which is exactly what I did twelve years ago after purchasing several Sydney properties and realising I needed a mix of negative and cashflow properties in order to continue on my investment journey.
Back then, I pulled up a map of the mighty Hunter Region of NSW and was surprised at how massive it was. And there are lots of cities and towns that don’t meet our development criteria. For example, Port Stephens is a big part of the Hunter Region. It’s a beautiful area with bushy mountains and dolphins frolicking in the bays making it a fabulous tourism location but unfortunately, there are not enough employment prospects. Some people live there and commute to work in other areas or like my mum, have retired there. It doesn’t stack up for us to develop residential properties here.
Property Bloom is continuously assessing locations around the Hunter for development prospects and we have one on our radar right now that I think will work very well, stay tuned.