{"id":5211,"date":"2015-07-31T01:00:19","date_gmt":"2015-07-30T15:00:19","guid":{"rendered":"http:\/\/realestatetalk.com.au\/?p=5211"},"modified":"2015-07-31T01:00:19","modified_gmt":"2015-07-30T15:00:19","slug":"suburb-gentrification","status":"publish","type":"post","link":"https:\/\/channels.realty.com.au\/realtytalk\/suburb-gentrification\/","title":{"rendered":"Suburb gentrification – Peter Koilizos"},"content":{"rendered":"

 
\nSuburb gentrification is the new term for a hot spot. So what determines that an area should be, or is about to be, gentrified. Property lecturer and author Peter Koilizos<\/strong> says many investors have jumped in thinking an area is about to be transformed when it was never going to happen because the fundamentals were never there. In today’s show, Peter tells us what to look out for.
\n <\/p>\n

Transcript:<\/h4>\n

Kevin<\/b>:\u00a0 A suburb that\u2019s gone through gentrification is a suburb that no one really has wanted to live in for some 30 to 40 years but which is now desirable and a more expensive place to live. As an example, Balmain in Sydney, St. Kilda in Melbourne, New Farm and Newstead in Brisbane, as well as Paddington in probably both Brisbane and Sydney. How do we find out the next ugly duckling waiting to turn into the next swan?
\nPeter Koulizos, property lecturer and author, has been looking at this, and he joins us. Peter, why does gentrification occur?
\nPeter<\/b>:\u00a0 Gentrification occurs when wealthier people move into an area, in particular, an area close to the city or close to the sea. But very importantly, it needs to have character and\/or period-style buildings, because it\u2019s those sorts of buildings that the people are looking for to update and live in.
\nKevin<\/b>:\u00a0 Generally, how long does it take for a suburb to become gentrified? I mentioned there at the start about Balmain in Sydney and St. Kilda in Melbourne. Typically, how long? Is it like a generation?
\nPeter<\/b>:\u00a0 Yes, a generation, decades. It doesn\u2019t happen overnight. Places like Balmain didn\u2019t become highly sought after overnight. It was down and out for maybe a century. I\u2019m not exactly sure, but it was certainly down and out for a long time. It could take 20, 30, or 40 years to come good. Then people very much want to live in those sorts of areas, but obviously pay a very high price to live there.
\nThe key is just because something has started to gentrify doesn\u2019t mean you\u2019ve missed the boat, because you still have many years to go. In many cases, you\u2019re far better off being relatively sure that the area is being gentrified rather than buying in somewhere thinking, \u201cOh, yes. Well, surely, this has to be gentrified sooner or later.\u201d
\nDon\u2019t forget, if your property investment goal is only five years \u2013 and I\u2019ve just said that gentrification could take 30 to 40 \u2013 well, buying in an area that hasn\u2019t even taken off yet is not going to meet your property investment goal.
\nKevin<\/b>:\u00a0 But I guess in a sense, the longer it takes, probably the more substantial it\u2019s going to be. It\u2019s a bit like oak trees take a long time to grow, whereas weeds grow almost overnight and don\u2019t have any life span.
\nPeter<\/b>:\u00a0 I like that analogy, Kevin. That\u2019s very good. Can I use that, as well?
\nKevin<\/b>:\u00a0 You certainly may. Any time at all.
\nPeter, what sort of impact does gentrification have on property values?
\nPeter<\/b>:\u00a0 Oh, it\u2019s fantastic. You have the solid bones of an older-style property, a character property. Somebody comes in, polishes the floorboards, updates it and keeping the character, possibly does an extension, pours a lot of money into the property. At the same time, the local council and possibly state government are also fixing up the area. So, so far as property values are concerned, it\u2019s fantastic. They increase markedly, especially compared to the majority of the property market.
\nKevin<\/b>:\u00a0 Yes, I guess it comes down to pride, too, doesn\u2019t it? If people can see their area improving like that, they\u2019ll take a lot of pride in their own property, as well, Peter.
\nPeter<\/b>:\u00a0 That\u2019s right. Don\u2019t be scared off by the high prices because in my opinion, you\u2019re far better off getting a small property in a good location than a big property in a poor location. Even if you can only afford in a one-bedroom unit in an area that\u2019s going up in value, that\u2019s being gentrified, you\u2019re far better off doing that than spending the same money in another area to buy a house that is a long way from town and is a long way from being gentrified.
\nKevin<\/b>:\u00a0 Peter, I\u2019ve heard you say that you should drive through a suburb. What is it \u2013 when you do \u2013 that you look for?
\nPeter<\/b>:\u00a0 I look at a number of different things. I look at the people in the area. Are there young adults wandering the streets in the middle of the day and there\u2019s vandalized bus shelters, or are there lots of well-dressed parents pushing prams with young kids in them?
\nAs you mentioned before, housing. Is there evidence of people being house-proud, or are the front yards full of weeds and car wrecks? So far as cars are concerned, are there lots of little prestige cars, like little black BMWs, Audi, or Lexus? This is a sign of wealth. Streets: are there wide tree-lined streets? Are they lined by \u2013 in the main \u2013 character or period-style homes?
\nThere are lots of little things that I look for. Even looking at places where people go to have a drink or have a bite to eat. If you go to the caf\u00e9, are they just selling your standard cappuccino flat white, or are they selling herbal teas and affogatos and macchiatos, and for the little children, babycinos. The second type of caf\u00e9, you will generally find in a gentrifying area.
\nThe local pub: is there a jazz band on a Sunday afternoon playing in the courtyard? Is there a wide selection of boutique beers on tap, or is it mainly VB and Tooheys on tap, horseracing on the big screens, and not a glass of wine to be seen anywhere?
\nKevin<\/b>:\u00a0 You really have to get your feet on the ground, haven\u2019t you? When you\u2019re going through these suburbs and you identify them, what types of properties do you look for in those areas, Peter?
\nPeter<\/b>:\u00a0 The keys are the older style, the character properties, and the date or the event to remember is the 1940s or World War II, anything before then. Some of the common styles are art deco, bungalows, cottages, villas, or in Queensland, the typical Queenslander-style property. They\u2019re the sort of properties that do best because many people \u2013 and in particular white-collar workers \u2013 are willing to pay a premium for those older style homes in anticipation of updating them.
\nOr you can even take the next step. You can buy one of those older-style homes, update it yourself, and then people will pay you a huge premium for that.
\nKevin<\/b>:\u00a0 My guest this time has been Peter Koulizos. Peter, thank you very much for your time.
\nPeter<\/b>:\u00a0 My pleasure, Kevin. Thank you.<\/p>\n","protected":false},"excerpt":{"rendered":"

  Suburb gentrification is the new term for a hot spot. So what determines that an area should be, or is about to be, gentrified. Property lecturer and author Peter Koilizos says many investors have jumped in thinking an area is about to be transformed…<\/p>\n","protected":false},"author":176692471,"featured_media":5202,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[10,13,25],"tags":[101],"class_list":["post-5211","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-kevin-turner-sponsored-channels","category-latest-story","category-sponsored-channels","tag-podcast"],"yoast_head":"\nSuburb gentrification - Peter Koilizos - Realty Talk<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/channels.realty.com.au\/realtytalk\/suburb-gentrification\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Suburb gentrification - Peter Koilizos - Realty Talk\" \/>\n<meta property=\"og:description\" content=\"  Suburb gentrification is the new term for a hot spot. 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