If you have your eye on Wagga as a place to start your property investment portfolio, you are in the right place, say experts.
Wagga and the nearby Snowy Valley local government areas (LGAs) are more affordable markets compared to Sydney and the like with higher short-term resilience and higher long-term capital growth.
Chief economist of PRD, Dr Asti Mardiasmo, believes Wagga is an attractive and affordable investment prospect.
“Wagga Wagga is showing resilience in the current higher cash rates conditions, growing by six per cent instead of softening or showing price decline like Greater Sydney,” she said.
“This means on a long-term basis, you are getting slightly higher capital growth.”
Historically, she said Wagga also had a higher rental yield compared to Greater Sydney.
“This means that it is more beneficial financially for an investor as you are getting more ‘bang for your buck’ on your investment.”
Dr Mardiasmo leads a nationwide research team and has a comprehensive understanding of market trends and insider insights.
She said there were some key points to consider when embarking on purchasing property for investment.
“In terms of what you are looking for, it should always include short-term resilience, 12 months to two-year growth.
“You also need to consider the long-term capital growth over 10 years.
“Affordability is key. Are you getting bang for your buck? Are you buying in an area that has low vacancy rates? As this could mean a better or higher rental yield.”
Dr Mardiasmo said vacancy rates in Wagga had been declining since COVID-19 and stood at 0.6 per cent as of October 2023.
“This is lower than Sydney metro’s 1.3 per cent.
“The Real Estate Institute of Australia’s healthy benchmark is 3.0 per cent, which means there is quicker rental occupancy in Wagga Wagga.
“This is excellent for investors, as you want your rental properties to be occupied as quickly as possible to ensure cash flow (rental income).”
According to Dr Mardiasmo, the Wagga Wagga LGA median house price was currently $570,000, with a one-year growth of six per cent and 10 years growth of 81 per cent.
“In comparison, the median house price in Greater Sydney is $1.2 million, with -2.9 per cent one-year growth and 71 per cent 10 years growth,” she said.
PRD Wagga’s Ryan Smith said there was plenty of opportunity in the area because Wagga had a transient population, meaning the rental market was strong.
“There are good properties on the market right now,” he said.
“The entry point in today’s market for a freehold house is in the mid 400s and it’s 300k-plus for a unit.”
He advised talking to a broker before purchasing your first investment to ensure you could afford it, as well as seeking help from an agent with good knowledge of the area you were interested in.
“Start looking online and going through open homes, this will give you a feel for what is out there and what you will need to spend. You also need to work out if it’s a freehold home you want, or something with a strata or community title,” Ryan said.
“These are all the things you need to work out, along with if the property fits the demands of what the current market needs.
“Build your knowledge so you have the ability to have confidence in making a buying decision when you’re ready.”
PRD will hold an ‘Unlocking Opportunities’ event for existing or potential property investors on Tuesday 21 November at Romano’s Hotel in Fitzmaurice Street, Wagga Wagga from 5:30 pm – 8 pm. Dr Asti Mardiasmo will be the night’s guest speaker. You can find out more and register HERE.