There are Property Markets and there are Property Markets

Graeme Salt

 Yesterday’s announcement by the NSW government to redevelop the 3km-long rail corridor south of Redfern station stands to have a significant impact on the Sydney property market.


 


The media often produce statistics on whether the property market is up or down. But these national figures often hide the truth that there are markets within markets. Often, say the national market is flat, there can often be pockets that are experiencing growth. Over recent years, WA and NT have experienced huge growth while NSW and VIC have been flat.


 


Infrastructure investments are one of the biggest determinants of a particular property market’s buoyancy. A number of my Sydney clients have talked to me about opportunities that will be provided due to the new North West Rail link. The redevelopment south of Redfern, centring on the old Eveleigh railway yard is likely to have a huge impact on suburbs such as Redfern, Chippendale and Camperdown. One of the main impacts will be that the area is a much more pleasant place to live. The best proof of this is New York, where Central Park is built over the train lines to Grand Central Station. An apartment adjacent to Central Park is now des res – could it be the same for a Darlington property in a few decades’ time?


 


But, infrastructure can also bring prices down (not always a bad thing). In Melbourne, Docklands has produced a large supply of units – one reason why Melbourne property prices are down (but also more affordable).


 


Some examples of infrastructure investments include:


  • New transport links
  • New schools, universities and hospitals
  • Landowners releasing large tracts of land for redevelopment (Harold Park trots or the old Broadway brewery)
  • Environmental improvement initiatives, such as parks.

 


So, for those looking to invest – do your research. Get to know an area. Most of these infrastructure improvements are instigated by governments (at all levels) – research what their policies are. When you know where there is likely to be infrastructure investment you will be able to see significant price movements.


Caveat. Years ago, Graeme was a town planner – so he has some idea of what happens in these situations