I did a podcast recently giving my top suburb picks for the Sydney market in 2024.
Now, generally I hate “hot spotting”, for a few reasons:
Firstly, I think property prices generally rise and fall on macro trends, such as interest rates, currency devaluations and demographics. Hot spotting risks you jumping at shadows and chasing fads.
And secondly, I think hot spotting assumes that today’s blue ribbon suburbs won’t be the blue ribbon suburbs in 50 years’ time – but they definitely will. To illustrate, Bondi, Mosman and Vaucluse may not be my 2024 “hot spots”, but these are still the suburbs that ultimately you want to own. Point Piper will still be Point Piper at the end of 2024 – don’t worry about that.
That said, I believe that there are localised factors that will prevail over the next year or two which lead me to believe that the following suburbs represent good buying. I have tried to reference suburbs across a range of budgets. Here goes, in no particular order.
With a median house price of $5.8m, Longueville is already one of Sydney’s premier suburbs. However I still believe Longueville is under-loved and frankly, under-known. With sweeping views of Sydney’s iconic harbour on one side, Longueville is a hidden gem on Sydney’s lower north shore. Despite its hefty price tag, I am confident that Longueville is still playing catch up to Sydney’s better-known harbourside suburbs, and that is just fine by the Longueville locals. My sense is that prices have been held back as it shares a postcode (2066) with its less expensive Lane Cove neighbour. However, I am confident that the Longueville engine is just getting warmed up.
2. Lane Cove
Recently voted the second most liveable suburb in Australia, this lower north shore suburb is really starting to shine. Historically Lane Cove was perceived as a bit of a “nursing home”, a quiet and leafy suburb for older people, next to the more bustling Chatswood. However, the creation of the Lane Cove Village and the Canopy has attracted restaurants and night life, and during the day is a beacon for young families in the area. Lane Cove is a big suburb and prices have a lot of variability. Also, it is no secret that the last few years have seen an influx of low rise apartments. However the new apartments are now done and the new supply has already been absorbed. With a median of $3.2m for a house, I see a very healthy capital growth over the next few years for Lane Cove.
This is classic “ripple effect” play. Eastlakes has a median house price of $1.8m, but sits snugly between Roseberry ($2.1m , Kingsford ($2.4m) and Maroubra ($2.7m). Eastlakes (along with Matraville and Botany below), are where the children who grew up in the Eastern suburbs but can’t afford to live near mum and dad, are moving into (along with the St George area). Very little downside risk here, in my opinion.
A sister suburb of Eastlakes (above) and Botany (below), these are the forgotten suburbs of the south east, which are quickly gentrifying. This is again a ripple effect story, with a median price of $2.4m, but neighbouring the more expensive Maroubra, Malabar and Little Bay. A grower.
Botany is in my trio of the south East, along with Eastlakes and Matraville. It appears for the same reasons (ripple effect), but I am less confident on my timing for Botany, and I suspect this will take a longer time to run. Botany still has an industrial edge to it which will take longer to gentrify, but if you have patience, this has real potential. With a median house price of $1.8m, there is a lot of upside compared to peers.
6. Five Dock
My only entrant from the Inner West, Five Dock (and Canada Bay in general) retains its charm and café culture without being a student hang out like other parts of the inner west. With the Bay on one side and a more urban edge on the other side, Five Dock has a lot to offer. However it makes this list because the new metro station is being built which will transform this suburb – ie “Metro Mania”. Some locals fear the “Burwood-isation” of Five Dock once the Metro is built, though I think this is not a terrible thing. Five Dock risks lose some of its charm however at this moment, however the upside from the Metro and potential rezonings far outweigh these other hypothetical concerns. A very strong bet for the next year or two.
I promised I would mix things up, but this may come as a surprise to many. I am a big believer in the Sydenham to Bankstown corridor over the next few years as the Metro comes through – more Metro Mania. Punchbowl, Wiley Park and other stations will transition from a train every 15 minutes to a train every 4 minutes. Punchbowl also is toying with a very generous rezoning in the vicinity around the station. Betting on a rezoning is extremely risky (do your own homework), however more density will have to come to this area which is primed for growth. Punchbowl itself has a thriving strip of shops and restaurants, and while it is not for everyone, we can see from the very low vacancy rates that these areas have high demand and low supply.
So there it is, my hot takes for 2024 and beyond. Hot-spot at your own peril of course, but perhaps tuck this article nicely away in a draw and revisit it in 18 month to see where the chips have landed.
For your listening pleasure, the full pod cast is below.
Caveat: this is not financial advice. Please consider your own objectives and seek financial advice where necessary.