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Hornsby versus Frenchs Forest: An investment comparison.

Penelope Valentine

Hornsby versus Frenchs Forest: An investment comparison.

Those lucky enough to live in either of these delightful northern Sydney suburbs understand the attraction they have for not only residents, but those keen to invest in them.

The good news is both have enjoyed spectacular capital growth over the past five years while enjoying low rental vacancy rates and – compared to much of the Sydney market – reasonable rental yield returns.

Before we look at an investment comparison, let’s consider some key pricing and rental information for each.

Hornsby – pricing statistics at a glance

Hornsby has a population of around 22,000 people with approximately 40 per cent living in rental accommodation.

The median price for houses is currently $1,220,000 – a staggering 68% increase over the same period 5 years ago – giving the suburb an average (annual) compound growth of 11%.

For units, the median price is currently $670,000 – a 35% growth over the past 5 years.

Hornsby – rental statistics at a glance

The average rent for houses in Hornsby is $640 per week while units are averaging $480. The overall demand for rentals has varied over the past two years with an average of 700 people looking each month. Rental yields have also varied over the same period with house rental yields currently at 2.5 per cent and unit rental yields sitting at 3.7%.

The current vacancy is low at only 2.10% – a good sign for investors!

Frenchs Forest – pricing statistics at a glance

Frenchs Forest is smaller than Hornsby with a population of 14,000 people and approximately 12 per cent living in rental accommodation.

The median house price is $1,500,000 – a remarkable +70% over the same period five years ago.   

For units, the median price is currently $660,000, however, low stock volumes means it’s difficult to accurately determine ‘statistically significant’ capital gain changes over the past five years.

Frenchs Forest – rental statistics at a glance

The average rent for houses in Frenchs Forests is $875 per week while units are averaging $573. The overall demand for rentals has varied over the past two years with an average of 600 people looking each month. Rental yields have also varied over the same period with house rental yields currently at 2.9% and unit rental yields sitting at 3.2%.

The good news is the vacancy rate is only 1 per cent!

So which suburb offers better investment options?

Looking at the state of the market for each suburb – both capital gain and rental yield opportunities – and indeed, the state of the market in Sydney in general, both suburbs offer substantial upside for investment opportunities.

Hornsby

On the sheer weight of numbers, there are more investment opportunities available in Hornsby by virtue of available unit stock and the higher proportion – 39% as opposed to Frenchs Forest 12% – of those residents renting.

There is also a significantly higher population than French Forest leading to higher sales turnover rates – putting downward (competitive) pressure on prices. The vacancy rate is very low highlighting investment properties keep their tenants and from an infrastructure and services point-of-view, Hornsby sits on a major train line for easy commuting.

With historically strong capital growth and – at least compared to other Sydney suburbs – sound rental yields, Hornsby is an ideal place to consider property investment.

Frenchs Forest

More of a private enclave, Frenchs Forest offers a smaller community – about half the population size of Hornsby – with fewer units and more homes. Leafy and considered more affluent, there are perhaps fewer and higher dollar investment opportunities, however, longer term capital gain may be better than its larger counterpart. In addition there is a new hospital almost at completion and considerable infrastructure planned for the Forest Way shopping village, including new residential and commercial properties.

Despite its low rental population – only 12%, it still has a vacancy rate of only 1%. Overall, it offers a more exclusive investment opportunity and one that should be considered for the longer term.

 

Talk to us about Hornsby or Frenchs Forest investment!

Property Alchemy is a Hornsby and Frenchs Forest investment and property management specialist. If you’re considering investing in either of these areas or currently have property you need professionally managed, we would be delighted to discuss how we can help.

At Property Alchemy, we understand property investment and can help you with property management services from tenant selection, property care and long-term investment wealth creation.

  

Penelope Valentine

www.propertyalchemy.com.au

0404 481 613

 

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