How to identify the best suburbs for property development in Australia right now
Published 6:22 am 12 Oct 2018
Property development market research is critical when trying to find the best places for development in Australia right now? DG Institute Founder and CEO, Dominique Grubisa explains how to identify the best locations to buy property and what you should be doing with them for the best returns in the market.
When I travel around the country speaking, I always get asked, where is the best place to buy property right now? And because I travel Australia-wide, and I meet thousands of people when I speak, I get a real feel for what’s going on on the ground and what people are thinking.
Markets are driven by people’s sentiment. It really is the expectation of what people think will happen that often drives a market. So I’m really switched on to what people are thinking. But at the end of the day, the true secret is that there is no one secret place, and there is no right nor wrong market. In fact, markets are neither good nor bad, that’s just the perception, that’s the lens that people, that the emotions of the market see things through.
A market just is. It is what it is, it’s a fact, it’s not good nor bad, there’s no emotion attached to it. It’s the people who drive the emotion. So what we need to look at when we’re asking where’s the right place? Is really, what is the market doing?
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Right now, we’ve got a pretty balanced, flat market. People aren’t running for the exits, and people also aren’t bidding up prices anymore. It’s a level playing field, and if anything, it’s probably pro-buyer, and that’s a great thing for us, because when market sentiment is down, when everyone’s expecting that things are going to fall, when the media is all saying doom and gloom in property, then the expectations are low, and it is in your favor.
Warren Buffett once said that the secret to getting wealthy is to be fearful when others are greedy and greedy when others are fearful. So if people are fearful right now, then it’s time to get into the market, and that’s what the smart money is doing.
Is the smart money rushing to one place in Australia? No, Australia as a property market is very large, and in fact, to say this is what the Australian property market is doing is just a misnomer. The market research for property development in Australia is very broad, not just on a state level nor a capital city level but right down at a granular level, suburb by suburb, street by street. There are opportunities everywhere in a market like this.
I always say, the deal of the decade comes along once a week. In any market, it’s just a question of switching in, turning on your intentions, and making a commitment to move forward. So, where should you be looking for opportunities? Right now, in a pro-buyer market, I would be looking at development opportunities.
Property Development Market Research
What to look for when selecting suburbs for property development in Australia:
1) What is a Greenfield Development?
Areas where the local government and the planning authority want the urban sprawl to go. Growth corridors, so at the moment, as the name suggests, greenfield development, it’s green, it’s like farmland. And what they’ve done is they’ve said, this is where we’re going to be building infrastructure, this is where people will be living, these are the satellite cities, and this is where we’re re-zoning. Now that’s all a matter of public record, and you can get that state by state, city by city, you can know where the growth corridors are and where the urban sprawl is going. So look for opportunities in those suburbs.
2) What is Infill Development?
As the name suggests, filling in areas that are already built up, so it’s already an urbanised area, the infrastructures there, there’s transport spines, people live there already in those suburbs, but what they’ve decided, planning authorities, local councils have looked at where people want to live, they’ve looked at population growth, and they’ve said people are staying in this suburb, it’s closer to the city, and a lot of people don’t want to go out into the growth corridors, they want to stay where they previously lived. So think baby boomers, down-sizers, empty nesters, think of people wanting to commute to work everyday, think of smaller dwellings, because Australia isn’t like it used to be where we’d have the family home on the big block.
Living styles have changed now, there’s a lot more fractured families, divorce is more and more common, people are staying at home longer, and what that means is that there’s a lot more need for single dwellings that are a lot smaller: townhouses, apartments. So infill is where the planning authorities will say, you know what? Instead of this being an 800 square meter block, we’re going to allow that to have instead of one home (it may be medium density), you can put five or six townhouses on that same block, and councils will re-zone areas for infill.
So if you’re looking for opportunities right now, where you can get a lot of uplift and make a lot more money, look for those planned development zonings, greenfields site developments – they’re in every city and every state on the ground level, and look for infills, where you can do more with an existing property. And that’s where the smart money is getting in right now in this market to find opportunities to develop and to create a higher and better use for that land. Focus on that, and that’s where your profit will be in this market.
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