From Potts Point to the central coast: 17 property investment options in NSW for under $300,000: HTW

There is a diverse array of homes and apartments to buy under the magical $300,000 mark, according to valuers from Herron Todd White (HTW).

According to July ABS housing finance figures, the average size of an owner-occupier home loan in Australia fell $1,100 over the month to sit just above this benchmark at $300,500.

In Sydney, recommendations range from studio apartments in the highly regarded inner suburbs of Potts Point, Darlinghurst and Surry Hills to less fashionable 1960s and 1970s units in The Shire.

Current listings under $300,000 include this Potts Point north-facing studio (pictured below) with “a pleasant outlook over a common courtyard and located only minutes to the action and chic nightlife off Potts Point or Darlinghurst”.

It is being offered for sale by James Peach from BresicWhitney Estate Agents Darlinghurst, who is seeking offers in excess of $245,000. It last sold for $166,000 in September 2005. Local agents Laing Real Estate have no listings under $300,000 on its website, but did sell an $280,000 Roslyn Gardens studio Aquarius apartment earlier this year. It was a 26 sq m apartment which was shortly after available for $320 a week.

For investors looking for something around $300,000 mark in the Shire, Justin Buck from Cronulla Real Estate is offering a one-bedroom apartment in an older-style brick block of 10 with an asking price of $310,000 (pictured below). The property last sold for $114,000 in 1997. It sold for $18,500 in 1976.

According to HTW, rental returns for a $300,000 investment can be fairly attractive in inner Sydney.

“You can generally expect to get a 5% to 7% rental return on your property and vacancy rates are extremely low for most areas of inner Sydney.

“The type of property purchased at this price point is likely to be low maintenance due to the basic level of accommodation being either a studio or one-bedroom unit.”

HTW says it sees many investors at the $300,000 price point lured in by these low vacancy rates and good yields and they therefore tend to dominate this price point.

“The downside of investing in these types of properties is the relatively low capital growth.”

Here’s a rundown of what you can buy with $300,000 in your “Hello Kitty coin purse” in NSW:

1. Cronulla (southern suburbs): a basic 1960s or 1970s with no car accommodation

2. Lakemba and Wiley Park (outer inner-west ring suburbs):  standard two-bedroom unit with a car space

3. Potts Point, Darlinghurst and Surry Hills (inner city): a studio unit of 30 square metres or less

4. Ultimo (inner city): Accommodation in Unilodge complex is leased to students with prices starting from $160,000 for a 14-square-metre, very basic room

5. Penrith and St Mary’s (outer west): plenty of two- bedroom units under $300,000. However, in certain pockets just under $300,000 can secure an entry-level dwelling (fibrous or vinyl clad) on a good-sized land parcel.

6. Blacktown/Mount Druitt (outer north): units in this price range with $350 to 400 per week

7. Liverpool and Fairfield: lots of affordable units under $300,000, with a high rental return and plenty of public transport and shops, investors and first-home owners are potential buyers

8. Wollongong: older-style houses in southern suburbs such as Unanderra, Cringila, Berkeley, Warrawong, Dapto, Warilla, Mount Warrigal and Barrack Heights. These will generally be 1950s to 1960s brick or fibro two and three- bedroom dwellings in fair condition and without major updates. Those properties closer to the beach offer better long-term capital growth and rental returns of around 5% gross.

9. Wollongong CBD and North Wollongong: One and two-bedroom units. These will be older 1960s to 1970s walk-up style units generally with off street or single car parking.

10. Central Newcastle: Around $300,000 will buy you an older style small unit comprising one or two- bedrooms.

11. Kurri Kurri, Weston, Cessnock, Medowie and Telarah (Newcastle satellite areas): entry level properties

12. Wyong (central coast): recent sales under $300,000 include an older, three- bedroom home with garage and carport, a two- bedroom villa

13. Halekulani, next to Budgewoi (central coast): bursting with properties priced at around the $300,000 mark, with HTW calling these two locations “the unsung heroes of the region” with good shopping, schools, lake and beaches. A partly renovated three-bedroom hardiplank with garage recently sold for $281,000, which HTW says is a good representation of the values. Gross yields in this area are approaching 6%.

14. NSW mid-north coast: Houses can be picked up for $215,000 in Taree and $200,000 in Kempsey. In both of these inland centres vacant land typically sells for around $75,000 to $125,000, meaning “all but the most modern of dwellings can be acquired for under $300,000". HTW says former Department of Housing dwellings usually sell for under $150,000 while a wide selection of houses dating from the 1960s and 1970s are affordably priced at around $200,000.

15. Taree West: HTW recommends solid 1980s brick houses in and around Ritchie Crescent that are priced around $225,000.

16. Port Macquarie: detached houses are limited to smaller, older houses in central locations around Hills Street and Hudson Avenue. “We consider these quite reasonable value for money given their good location and potential for redevelopment,” says HTW. Alternatively the valuation firm says location can be traded for comfort, and a small modern three- bedroom single garage house on the city fringe in areas near Sherwood Road or Greenmeadows Drive on small blocks of land under 400 square metres in size.

17. Forster: a wide selection of small dated houses on small blocks that can be acquired for around $225,000 in and around Short Street. HTW recommends property in and around Forster Primary School for just under $300,000.