Melbourne's $16 billion North East Link freeway is an investor opportunity: John McGrath
The latest figures from the Australian Bureau of Statistics show the value of new loans to investors (excluding refinancing) across Australia jumped by 4.7% in July – the highest monthly gain since September 2016.
On the east side of the country, Canberra led the way with a 22% spike in the value of loans from June to July, followed by Queensland at 8.1%, Victoria at 5.7% and NSW at 2.0%.
John McGrath told Switzer readers, "My best piece of advice for property investors is to buy quality and focus on location and aspect."
"Go for a quality property in a great street, in a desirable neighbourhood, with plenty of amenities such as cafes, shops and public transport. These properties might cost a bit more, but you’ll get better capital gains."
"In terms of locations, I think a good strategy is buying close to new infrastructure. There is so much building going on and this is creating opportunities for investors to capitalise, especially in areas where prices have fallen during the downturn," he added.
He analysed the impact and reasons that investing near the Melbourne North East Link freeway, starting 2020 with the aim of opening in 2027, may have potential.
Impact: Connecting the M80 with an upgraded Eastern Freeway, this $15.8 billion road will cut travel times by up to 35 minutes to Melbourne’s rapidly growing northern suburbs. The commute by public transport will improve with the city’s first dedicated busway, with express lanes along the Eastern Freeway from Doncaster to the city.
Opportunity: Suburbs along the new road’s corridor should receive a boost. Take Greensborough, which will see greatly improved traffic flow with a new interchange at Grimshaw Street as part of the project. The median house price peaked at $830,000 in 2017 and today it sits at $755,000. The median apartment price was $633,750 in 2018 and it is now $570,000.
Prediction: CoreLogic-Moody’s Analytics predicts very strong growth of 18% in house prices in the North East, which includes Greensborough; and 5.1% growth for apartments over CY20 and CY21.
He also looked at the latest Melbourne, Canberra, Brisbane and Sydney infrastructure developments and the impact they have had and will continue to have.
JOHN MCGRATH is the Founder & Executive Director of McGrath