Best Suburbs To Invest In Newcastle
Newcastle is a city that offers diverse opportunities for property investors on a spectrum of budgets. From vibrant inner-city suburbs to quiet, family-friendly areas, there is a suburb to suit every investment strategy. This article outlines what our local experts consider when advising clients on the best suburbs to invest in Newcastle, breaking down options by price brackets to help you find the perfect match for your budget and investment goals.
Investment Fundamentals
Before we list our suburb recommendations by budget, its key to list some of the fundamental aspects of buying an outperforming property, no matter the location. These factors are general rules of thumb that we apply to ensure we aren’t buying just an average property in a suburb but instead finding the best-performing properties on the best streets.
Focus on scarcity; look for properties that are hard to replicate in areas with little to no vacant land for future building. Think character-filled homes in an established suburb.
Understand Owner-Occupier Appeal. Seventy per cent of the market are owner-occupants, so think and buy like one. If you think the bedrooms are too small, so will your tenant and future buyer.
Buy on the north side of the street; this is common sense, but only after you hear about it! Buying on the north side of the street opens the property up to more natural light, making the property more desirable to live in.
These, along with over 20 other factors, are what we look for in the perfect investment property. But what about the suburbs?
$600,000 - $800,000
Wallsend
Wallsend is an excellent choice for investors with a budget of $600,000 to $800,000. This suburb offers three-bedroom family homes in quiet streets, with capital growth ranging from 6.8% to 7.0% per annum over the last decade. Rental returns in Wallsend are around 4.0% to 4.2% per annum, making it a stable investment with solid growth potential.
Edgeworth
Edgeworth is another suburb within this price bracket, providing similar investment opportunities. With strong community amenities, schools, and parks, Edgeworth attracts families, ensuring a steady rental demand. The capital growth here has also been impressive, aligning closely with Wallsend.
Elermore Vale
Elermore Vale offers investors affordable family homes with good returns. Its proximity to shopping centres and medical facilities makes it a desirable location for renters. Over the past ten years, capital growth has been consistent, making it a reliable choice for property investment.
$800,000 - $1,000,000
Mayfield
Mayfield is an attractive option for those with a higher budget. Known for its vibrant lifestyle and proximity to the city for a reasonable price, Mayfield offers three-bedroom homes with one or two bathrooms on quiet streets. Rental returns in Mayfield range from 3.8% to 4.0%, with capital growth between 7.0% and 7.2% per annum.
Carrington
Much like Maryville, Carrington has seen a significant disparity in property values compared to its neighbouring suburbs. It offers a similar return on investment with robust growth. The community's charm and proximity to Newcastle's CBD make it a highly sought-after area for both investors and tenants.
Waratah
Waratah provides an excellent investment opportunity with its blend of older character homes and newer developments. The suburb's appeal lies in its family-friendly environment and proximity to the University of Newcastle. Waratah has seen capital growth of around 7.0% per annum and offers rental returns of approximately 4.0%.
$1,000,000 +
Tighes Hill
For those seeking high-growth assets, Tighes Hill is a prime candidate. This suburb offers freestanding houses on quiet, tree-lined streets. With growth rates ranging from 7.1% to 7.3% per annum over the last decade, Tighes Hill provides the highest returns for the lowest risk in this price bracket.
Hamilton
Hamilton is another high-growth suburb known for its bustling café scene and vibrant community. Investors here can expect solid capital growth and a slight haircut on rental yield, typically around 3.5% to 3.8%. Hamilton's central location and desirable lifestyle make it a top choice for long-term investment.
Adamstown
Adamstown is perfect for investors looking for high-growth suburbs. With its mix of modern and older homes, Adamstown attracts a diverse range of tenants. The capital growth rates here have been between 7.1% and 7.4%, with rental yields around 3.6%.
Investing Under $600,000 in Newcastle
While challenging, buying an investment property for under $600,000 in Newcastle is possible. This budget typically restricts buyers to older homes needing renovation or strata options. Suburbs like Mayfield and Islington offer more affordable entry points into the Newcastle market in the strata realm, while freestanding homes for less than $600,000 are few & far between. If our client is looking in Newcastle with a budget of less than $600,000, we would advise focusing on more affordable locations with similar fundamental attributes rather than buying a high-risk, rundown, freestanding house.
Conclusion
Newcastle offers a range of suburbs suitable for various investment budgets, each with unique benefits and growth potential. From affordable family homes in Wallsend and Edgeworth to high-growth opportunities in Tighes Hill and Hamilton, there's a suburb to match every investor's goals. Understanding the local market and choosing the right suburb is key to a successful investment.
Ready to explore investment opportunities in Newcastle?
Our team of local experts is here to guide you through every step of the process, ensuring you make a wise and profitable investment.