Location does matter!

I read an interesting article the other day by property analysts, RP Data, which showed that Sydney properties located in the premium postcodes had a significant increase in values above and beyond less prestigious areas. The report showed a significant variation in the growth of values across the different price points over the last five years.

In the last calendar year alone RP Data’s research showed that “ (Sydney’s) top 20% of postcodes have recorded a value growth of 12.5% with the middle market recording 11.8% growth and the lower end seeing growth of 9.1% during 2009”.

These results certainly show the importance of having a good understanding of the past and current values in the area in which you are looking to buy. However it’s important to note that whilst location is always very important, it doesn’t guarantee you a successful property purchase as there will always be underperforming properties in any area.

You still need to do your research and focus on buying in the better performing parts of a suburb if you want to receive above average capital growth for that area, as you would be a fool to think when it comes to real estate that a rising tide will lift all boats equally.