Will All Bridesmaid Suburbs Eventually Become Brides?

Will All Bridesmaid Suburbs Eventually Become Brides?

One of the things to think about when it comes to premium areas and their growth is that there’s no actual finish line. Balmain, for example, is a premium suburb and it reaches the million-dollar threshold first and then it stops and everything else has to catch up to it. You know it is a suburb that will continue growing, there’ll be ebbs and flows and all the rest of it, of course. 

If you look at Balmain as an example, why would somebody move to Rozelle rather than Balmain? So you’re moving further away from the ferry, further away from the water and parks and whatever but now, Rozelle’s got its own lifestyle. Now people actually specifically want to go to Rozelle versus Balmain so that begs the question will all bridesmaid suburbs eventually become brides?

The Ripple Effect

That’s an example of a permanent change that started as a ripple effect. It started that Balmain was where everyone wanted to be. They only went to Rozelle if they couldn’t afford to be in Balmain. When the market turns down a bit, they think, great I can afford Balmain now so I’ll leave Rozelle. But as time goes on, Rozelle gets to be very desirable its own. And then people start looking next suburb. And so then Rozelle’s closer to the top of the pie and, and then Leichhardt becomes the ripple. And so it does Leichardt then has the elements to have permanent growth, and to keep that level of appeal. I could actually pull that apart a bit to be quite honest as Leichhardt is still gentrifying. 

So that’s a good example of the ripple effect and it ebbs and flows and I’ve owned property in Leichhardt. What happens is that it becomes more desirable because everything else is priced out of reach. And then all of a sudden markets move and people might say I don’t want to be in Leichhardt, I’d rather be in Rozelle, and so then they turn back. So to be permanent, to have a permanent effect, or increase in terms of prices, in an area that’s experienced a ripple effect, it has to be properly gentrified.

Keep focused on key property characteristics 

Don’t forget the property in question has to have local characteristics that are equally desirable to the areas that people have foregone. The thing is though that those real premium suburbs and the real next ones down that never quite bridge that gap, they never quite have the elements in play to be a top performer. That gap over time actually gets bigger and bigger. 

It might be slow and imperceptible, but you know, Kent talks about it all the time and he talks about those suburbs along the coast, and then the ones on the inland, on the other side of a highway, there’s always a highway and the ones close on the right side of the highway, close to the coast, the gap to property prices and the growth, they get to a point where they almost decouple. And so there’s a level of relativity to a point and then they sort of aren’t relative anymore. You know you can’t bridge that gap. 

So I guess, it’s something to watch for when you’re making those compromises and going for the next best suburb, ask does that next best suburb run the risk of always being the bridesmaid or will all bridesmaid suburbs eventually become brides in their own right?

This is a conversation I’d love to encourage you to join. We need to be talking more about truth, transparency, and trust in the property industry. Reach out to me on Facebook or Linked In and leave a comment.

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