11 Feb Family friendly suburbs revealed as investor hot spots – Tim Lawless
It’s only natural that an investor will want to purchase a property that is popular with the vast majority of renters. So it does follow that these ‘family’ type properties will attract more consistent and possibly even higher rents. We catch up with Tim Lawless from Core Logic to find out the results of their family friendly suburbs report.
Kevin: It’s only natural that an investor will want to purchase a property that’s popular with the vast majority of renters, obviously, to get a higher return. For that reason, it’s important to note that in a recent CoreLogic report, it was revealed that 71% of households in Australia are characterized as families or households where the occupants are related. It’s interesting to note that 60% of those households have children residing in the dwelling.
So, it does follow that these family-type properties will attract more consistent and possibly even higher rents. To talk about the report from CoreLogic, joining me, is Tim Lawless.
Good day, Tim. Thanks for your time.
Tim: No problem, Kevin. Thanks for having me on the show.
Kevin: Tim, whereabouts are these properties found in different parts of Australia?
Tim: They’re all over the place, actually. There are some fairly evident concentrations in the areas that have a really high proportion of families, but you’ll find across each of the capital cities and the major regional centers, there are enclaves where families do seem to be most concentrated.
You’ll find, for example, that they generally do tend to be a little bit further from the city where properties are a little bit more affordable but also where transport options are quite prolific and all the necessary amenities are located around those areas as well.
Kevin: Tim, on a national scale, did one capital city stand out from the rest in terms of its popularity for establishing a family property?
Tim: It did. It was Sydney, and Sydney really stood out quite clearly. It was the southwest region of Sydney that had 10 of the top 20 suburbs that are most popular with families with kids. If you look at that top 20 table, which is available on the Aussie website, it starts out at West Hoxton and then Horningsea Park, both in the southwest of Sydney, where nearly 80% of all households in those areas are characterized as family households with kids.
Kevin: Is there anything that stands out why these areas are so popular for families?
Tim: There are a couple of reasons. They’re clearly quite affordable by Sydney standards. The typical price of a dwelling in both of those suburbs is around about $840,000 to $890,000. You might hear that and think “Wow, that’s not all that affordable, actually,” but in Sydney terms, where the typical price of a house is generally up around the $1 million mark, these are relatively affordable suburbs.
But they’re also on pretty decent transport thoroughfares, they have a lot of amenity around them, they’re quite established areas at many of these locations, and you do find that they also seem to have a commonality amongst themselves, which is there is not a great deal of densification in a lot of these very popular areas. So, while land sizes may be getting a little bit smaller, we’re not really seeing an introduction of medium- to high-density dwelling options.
Kevin: You mentioned their affordability, and it’s debatable whether that figure in Sydney is affordable, but we’ll go with that theory. Is affordability the key? In each of these areas, does it have to be affordable?
Tim: Not really. There are a lot of elements that, I think, families are looking for outside of the price tag. If it was purely based on affordability, you’d be finding there are a lot of other suburbs that are more affordable, for example, West Hoxton.
It comes back to a blend, I think, of suburbs being very affordable, or comparatively affordable, but also having access to infrastructure, having access to amenity like schools, healthcare, shopping facilities, and of course, having a decent commuting time into the main areas of work, as well. I think it’s really that blend of the price tag along with what’s actually available in the suburb in terms of amenity and infrastructure.
Kevin: Were there any key statistics that you used to define these areas, Tim?
Tim: It’s a blend of census data and housing data. We looked at the census data, which is still reasonably fresh, and down at the suburb level, we looked at those suburbs that showed a high proportion of families with children. So, it’s couples with kids as well as single-parent families. Then based on those lists of where families were most concentrated, we then matched up with all the relevant property data.
So, what’s the typical buy-in price for a house and apartment? But also, what’s the lower quartile value? So you can really see what’s the entry point rather than the middle price or also the upper price?
We looked at the average land size in the area, and one of the interesting things is quite often, these areas that are popular with families tended to show larger blocks of land as well. Then we also looked at how many sales there were and all those sort of things that people will be looking for.
Kevin: Tim, do you think the definition of the family home has changed over the decades?
Tim: It has to some extent. You can see the trend towards smaller households has certainly been evident. It seems to be bottoming out now at around about 2.5 persons per household. But we are seeing families now, generally, with fewer children. But also, there’s been this trend towards families, in some cases, sacrificing the backyard and moving into areas of high density, so maybe sacrificing a Hills Hoist for a courtyard and living closer to the CBD where they may find commuting times are a little bit better.
I think this study really does highlight that we’re still seeing this great Australian dream where families are aspiring to detached housing with a decent backyard is still very much alive and well. But I think when you consider the price tag for detached housing and the fact that lots are generally getting smaller, particularly for new green-field developments around the outer fringes, I think we are seeing a change in the way families are choosing to live.
Kevin: Great talking to you, Tim Lawless from CoreLogic. Thanks very much for your time, Tim.
Tim: Thanks, Kevin.