New infrastructure projects in an area can kickstart a sluggish property market and drive prices higher.
And a wave of extra buyers and renters generally means an upswing in property prices, according to Hotspotting founder Terry Ryder.
By keeping an eye on where these projects are coming up, buyers can get in early and take advantage of the price growth.
Mr Ryder said transport infrastructure was the main factor that drove prices higher.
A relatively small investment in transport could have a bigger impact than other more expensive projects, Mr Ryder said.
Public transport links and freeways unlocked inaccessible pockets of the city and shortened lengthy commutes.
There is no shortage of transport projects under way in Melbourne, with train station upgrades, freeway expansions and the East West Link project all promising to improve access to hubs outside the CBD.
Paul Osborne, founder of buyers’ advocacy Secret Agent, said owner-occupiers would prioritise different surroundings than investors.
“If somebody is buying a home, what they’re buying is their own environment or habitat,” Mr Osborne said.
Different types of infrastructure, such as green spaces and school zones, became much more important for them, he said.
“It might be harder to quantify visual things, but they really make a difference,” Mr Osborne said.
Mr Ryder honed in on Casey and Sunshine as hot spots for future capital growth. Both are relatively affordable property markets, with projects such as the $880 million reconstruction of Sunshine train station and the expansion of Monash University’s Berwick campus heralding an increase in housing demand.
“We tend to regard that as the power combination — jobs plus affordability plus infrastructure,” Mr Ryder said.
“We find that over the long term, the best capital growth rates tend to be in cheaper areas because that’s where the mass demand goes.”
Activity is already brewing in Sunshine, where the median house price jumped 23.2 per cent in the June quarter from $500,000 to $539,000, according to Real Estate Institute of Victoria figures.
Barry Plant Sunshine director Jason Allen said investors and owner-occupiers were flooding into the area.
“People have taken stock that there’s a lot of money being invested here,” Mr Allen said.
The spend on the train station had been a large drawcard, but buyers were also coming to Sunshine after being outpriced in the inner suburbs, he said.
In the eastern suburbs, Ringwood has emerged as a site for change. The State Government has designated Ringwood as one of Melbourne’s seven “Central Activities Areas” to become a hub for future employment and public investment.
A $575 million expansion of the Eastland shopping centre and a $66 million upgrade of the Ringwood train station and bus interchange are two major projects already under way.
Carter Ringwood agent David Green said: “While there was nothing happening people weren’t investing. Now work has started, the floodgates are open.”
Part of the capital growth was likely to occur while projects were still under construction, Mr Carter said.
There has been a flurry of interest in development sites surrounding the shopping centre, with a crop of new apartment buildings set to hit the skyline.
Mr Carter sold a 919sq m block at 8 Bourke St — 150m from Eastland — for $1.705 million in July, smashing the reserve price by $705,000.
“The buyer owned some adjoining land, so they were prepared to pay a price others wouldn’t,” he said.
The improvement in Frankston’s property market since EastLink opened provides some insight to the extent infrastructure can impact prices.
Hocking Stuart Frankston director Adrian Foster said the market was thriving. There had been two stages to the rise in real estate activity, first when the project was announced and now that people could see the benefits.
“It gives you an amazing run down to the peninsula for weekend activities and also a quick drive to the city.”
When John and Sabrina Putmandecided to downsize, it was to achieve a better lifestyle.
An apartment on Bourke St, Ringwood — a hop, skip and a jump from the expanding Eastland shopping centre and the train station — offered the right mix of convenience and investment potential.
“I think Ringwood in the next two to three years is really going to kick on,” Mr Putman said.
“It’s very cosmopolitan and it’s going to be a great investment.”
He said the easy access from other parts of the city made Ringwood the popular choice for shopping in the eastern suburbs.
“It’s that little bit harder to get out to Knox,” he said.
“Then there’s Doncaster, where you can’t get a parking spot.
“That’s why so many people are coming out here.”
Having EastLink close by for a quick commute to the city or his work in Dandenong South was another selling point.
“There’s just one set of lights then I’m on the freeway,” Mr Putman said.
“We’ve got everything we need, like we’re living in the inner suburbs.”
WHEN TOO CLOSE IS NO COMFORT
BEING close to infrastructure is a drawcard, but there’s a danger in being too close.
Properties that face a main road, major intersection or train tracks can have noise, privacy and security concerns.
Paul Osborne, founder of buyers’ advocacy Secret Agent, said people generally paid 10-15 per cent less for properties in those positions.
He gave the recent sale of 31 Cromwell Rd, South Yarra, as an example.
The four-bedroom terrace house, set metres from the train tracks, sold for $1.53 million in May.
“It should probably be worth another $1 million on top of that,” Mr Osborne said.
Flight paths, cemeteries and uncertainty about future projects could also cause prices to drop, he said.
And while investors were generally less picky than owner-occupiers, that could raise problems in the future.
“Some investors are more likely to go for things like main roads,” Mr Osborne said.
“But that’s probably the last thing they should do. When you buy a property, you’ve always got to think about when it’s time to sell.”
Hotspotting founder Terry Ryder said there was an ideal proximity range — within walking distance but outside noise concerns.
“The ideal would be about a kilometre from a train station,” Mr Ryder said.
Original article published at www.news.com.au by Nicole Engwirda, The Herald Sun Real Estate 18/8/2014
Rail line grows three times faster than state average
THE number of passengers travelling on Springfield’s rail line has grown almost three times faster than the state network average.
In a glimmer of good news for Ipswich’s public transport situation, new data shows 1.09 million passengers travelled on the Richlands Springfield Central line in the 2017-18 financial year.
Springfield Central was the most popular station, with 482,913 passengers.
Rail Back on Track spokesman Robert Dow said the figures were good news for Ipswich’s busy eastern corridor.
“It’s good people are using the system and it adds momentum for improvements to the bus network to get people to and from the station,” he said.
Since the 2016-17 financial year, patronage across the state’s rail network has grown 3.36 per cent.
Growth at Springfield Central has outstripped the average by recording an 8.13 per cent increase.
“Springfield looks good,” Mr Dow said.
While passenger numbers are positive at Springfield, other rail lines remain underutilised, Mr Dow said.
“It’s been pretty bad on the Ipswich-Rosewood line,” he said.
In the previous financial year, 1.77 million passengers used the line.
It was the first time in five years the network has recorded an increase in growth after a steady decline in numbers from a height of 2.1 million in 2012-13.
Mr Dow puts the most recent increase partly down to a new fare structure and regional growth.
“The population is increasing generally and people at Redbank Plains and places like that are driving to the Ipswich rail line,” he said.
Mr Dow said improvements still needed to be made on the region’s bus network.
He said park ‘n’ ride facilities at stops along the network were at capacity. Ipswich Station had the highest passenger fall, with 23,389 people deserting the track.
Redbank was the most improved station, with passenger numbers growing about 19,000 on the previous year, to 229,145.
“It’s good to see Rosewood has got growth – people are starting to use the Ipswich to Rosewood line,” Mr Dow said.
He said the passenger number information should be made free on the Translink website.
“TMR should make this sort of data available,” he said. “Having to pay $48 for this is fairly outrageous.”
Queensland’s $46 Billion Infrastructure Boom
The Palaszczuk Government has released an update to its 2018 State Infrastructure Plan as it aims to roll-out a total of $45.8 billion worth of infrastructure over the next four years.
The second part of its State Infrastructure Plan (SIP) focuses on a range of infrastructure spending with its updated release, outlining the $11.6 billion of infrastructure investment to be rolled out in 2018-19, which aims to support up to 38,000 jobs.
Economic forecaster Deloitte Access Economics said that the outlook for engineering construction in Queensland is better than it has been for some time.
“Rather than wallowing in cash from a strong property market and asset privatisations as NSW and Victoria are, the Government is relying more heavily on raising new tax revenue and increasing debt to fund this infrastructure,” Deloitte’s quarterly Business Outlook report said.
Up to 65 per cent of the Queensland’s infrastructure budget is allocated outside of the greater Brisbane area, explained Minister for State Development, Manufacturing, Infrastructure and Planning Cameron Dick.
“Programs like the Queensland Transport Roads and Investment Program 2018-19 to 2021-22 outlines $21.7 billion in transport and road infrastructure over the next four years, estimated to support an average of 19,200 direct jobs over the life of the program.
The $5.4 billion Cross River Rail project, the biggest state funded infrastructure commitment in more than a decade, will be delivered in partnership with the private sector, explains Dick.
Infrastructure Association of Queensland chief executive Steve Abson said the infrastructure investment strategies update provides the private sector with confidence to invest in their Queensland operations.
With it now required to be “actioned collaboratively by all levels of government and the private sector”.
Seven new projects have been added to the Building Queensland (BQ) infrastructure pipeline, including upgrades to the centenary motorway and Sunshine Motorway, and a third track to be added to the Gold Coast rail line between Kuraby and Beenleigh.
BQ Infrastructure Pipeline Report which presents priority infrastructure proposals under development by the Queensland government, shows 18 proposals from the pipeline has received funding commitments from state government since June 2016.
These include upgrades to the M1 from Eight Mile Plains to Daisy Hill, and Varsity Lakes to Tugan, the Beerburrum to Nambour Rail Upgrade, the Lower Fitzroy River Infrastructure Project and the New Performing Arts Venue.
A rise in interstate migration is seeing more people moving to Queensland, according to the Deloitte’s Business Outlook report, which says the sunshine state now has the third-fastest rate of population growth behind Victoria and the ACT.
The report said that Queensland is “well and truly” through the worst of its mining construction downturn as eye-watering house prices south of the border are sending more “economic refugees north to Queensland”.
Five Ipswich public high schools to get new classrooms
The State Government will commit $250 million over two years in the State Budget to build additional classrooms at more than 60 schools including Bremer, Ipswich State High School, Laidley State High School, Lowood State High School and Springfield.
Deputy Premier and Treasurer, Jackie Trad, said the ‘2020 Ready’ funding boost would support students in more than 60 Queensland high schools across the State.
“Our kids are our future and, as a government, one of the most important things we can do is give Queensland students a world-class education,” Ms Trad said.
“This investment will deliver more classrooms and learning centres to provide the best possible environment for learning.
“Queensland is a fast-growing State and this investment is about planning for the future.”
Education Minister Grace Grace said in 2020, for the very first time in Queensland’s history, high schools would have a full complement of students across Years 7 to 12.
“This infrastructure program is about making sure we are ‘2020 Ready’,” Ms Grace said.
“This $250 million investment will ensure our schools can accommodate the additional 17,000 students expected in our high schools from 2020 and into the future.
“It brings the total funding commitment towards increasing the capacity of state secondary schools to more than $470 million between 2017-18 and 2019-20.”
Ms Grace said the ‘2020 Ready’ program signals the next phase of Queensland’s major education reforms, which started more than a decade ago.
“Queensland’s first intake of Preppies were those whose birthdays were in the first half of the calendar year – so theirs has always been a much smaller cohort of students, known as the ‘half cohort’,” she said.
“Our next educational reform came in 2015, when we moved Year 7 into high school and established six years of secondary education, which was also supported with significant infrastructure investment.
“However, our smaller ‘half cohort’ has been in high school since 2015 too – meaning we have never had the full complement of students across all six year levels in our secondary schools.
“With the original Prep students set to graduate from high school at the end of 2019, we will have – for the very first time – six full year levels of students in Queensland secondary schools from 2020.
“This new $250 million investment for additional classrooms will prepare those schools identified as requiring additional capacity for the additional students expected in 2020.”