Five tips for investing in the Sydney CBD residential market: Carlie Ziri

The Sydney 2000 postcode is unlike any other property market in the country.

It is predominantly an investor market with almost two-thirds (63%) of its 14,000 apartments currently leased to tenants.

It is a unique and dynamic market but it can also be fickle and erratic. With over 20 years’ experience selling and leasing inner city property, I am passionate about educating buyers on how to make their investment in our beautiful city work in their favour.

The key to success is to have an innate understanding about what you are buying, and a realistic view of the returns and capital growth you can expect to see in the short, medium and long term.

Within the Sydney CBD, there are three distinct markets with different characteristics that investors need to be aware of:

City North – covers Margaret Street through to Walsh Bay

Mid City – starts from Hunter Street through to Bathurst Street

City South – runs south of Bathurst Street through to China Town

Property prices vary between these precincts, with the City South home to more affordable residences, while the northern tip of the city offers some of the most expensive real estate inAustralia, with apartments achieving over $65,000 per square metre for a small piece of Sydney’s inner city lifestyle.

One thing that is common among all of these precincts is volatility, and the return on your investment can vary dramatically depending on where the property is located and what attributes it has.

For example, in the space of one week, I negotiated a deal where one client made over$300K on an apartment she owned for just 12 months, while another client made a $25K loss on an apartment he owned for over 15 years.

These apartments were located within three blocks of each other; however the latter apartment had no view, balcony or parking, while the former offered all three of these imperative attributes.

At the moment, there is no shortage of premium apartments with big price tags in new city developments; there is however, a high demand for one and two-bedroom apartments in the more affordable price range of $550,000 to $1 million.

With many buyers looking to purchase before the end of the financial year, owners with inner city properties priced between $550,000 and $1 million are in a prime position to achieve a record price over the next few weeks.

The tricky part is finding a vendor who is willing to sell; most I have spoken to are achieving such great returns, they are not willing to sell.

The Sydney CBD offers buyers a secure investment in the medium to long-term, and with the right choice, rental returns are higher than other Sydney suburbs.

However, it is imperative that the property ticks certain boxes.

There are five key things I strongly recommend you look for to ensure your inner city purchase is a successful venture:

1) Building: Purchase in a well-managed and desirable development

2) Views: Harbour or iconic views attain the highest capital growth. If your budget is limited, ensure you at least have a great city outlook

3) Parking: Although not essential, it has a big impact on your property’s re-sale value

4) Outgoings: Ensure outgoings are reasonable and have long-term sustainability

5) Location: Buy in a development that is well placed to offer residents a fabulous inner city lifestyle with key desirables in arms reach i.e. transport, shopping, restaurants,entertainment and parks.

Carlie Ziri is the director of Lifestyle Property Agency.