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Saturday, 12th September 2009

Investors Size Up Suburban Returns - Courier Mail

Some savvy investors are doing their sums and turning their backs on the inner city to earn a good return in more outlying suburbs for a smaller capital outlay.

Doctor and investor Anthony Lentz chose leafy Sherwood, in Brisbane’s south-west, for an investment unit after looking how far his money would go compared with other suburbs.
 
“I thought this unit was a place I’d much rather live than others I could buy closer to town for the same money,” Mr. Lentz said.
 
He bought the two-bedroom Parklands unit off the plan for $500,000 and leased it within 5 days for $440 a week. “It rented very quickly……….. and because it is a new unit I get better depreciation,” Mr. Lentz said.
 
He said the design, with two bathrooms, two parking spaces and a separate study, meant he would be happy to live in the unit if he had to.Parklands is developed by Pradella, which has won awards for inner-city projects including the Roma st parklands.
 
One-bedroom apartments are selling from $375,000 and two-bedrooms from $479,000. Pradella’s director of sales and marketing, Ross Higgins, said the outlay for new suburban apartments was much less than that for new central business district developments, and yet rental returns were matching, and in some cases beating, inner-city locations.
 
He said rents at Parklands were between $440 and $460 a week for a two-bedroom unit. The Real Estate Institute of Queensland’s March Quarter data reveals a CBD apartment average of $430 a week.
 
Mr. Higgins said more than 60 percent of sales at Parklands at Sherwood had been snapped up by investors. “Developments in suburban areas and within a reasonable commute to the CBD are certainly coming more into vogue and will increasingly do so as inner-city affordability continues to bite, “ he said.

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