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Top 100: Please explain

For those locations named in the 2007 Hot 100 that showed negative growth over the past year, API asked the experts who nominated those suburbs to explain why the predicted growth didn't occur and to declare whether they stood by those suburbs as good investments for the medium to long term.

Report card: 2007 Hot 100

Note: Figures sourced from RP Data for the 12 months to June 2008. Where individual suburbs were unavailable from RP Data, figures were sourced from Australian Property Monitors. All figures are for house price growth.

Michael Carman
Wealth Enhance managing director Michael Carman added Campbelltown to last year’s Hot 100 list. He says the area has been hard hit by loan defaults and believes the overhang from these has affected growth.

“As to whether Campbelltown remains a good medium to long term investment, my answer is a resounding yes for the same reasons I mentioned last year: it's a major population and employment centre and therefore has the advantage of service and amenity,” he says. “I still recommend it as a long-term investment.”

Bernard Salt
KPMG demographer Bernard Salt nominated Bacchus Marsh for last year’s Hot 100 and though its returns over the year are in the red, Salt believes it remains a good investment.

“There may have been any number of reasons for the downturn,” he says. “The spike in petrol prices. Some local factor that we’re not aware of. Better opportunities in say Caroline Springs. But with continued growth out west and as people increasingly telecommute many I think will want the sanctuary of a pretty and green village that Bacchus Marsh can offer… Bacchus Marsh is a green oasis and a tree-change town within commutable distance of Melbourne's west. It must be a winner over the medium term.”

Damian Collins
Momentum Wealth managing director Damian Collins named Dianella as a hot suburb last year and it’s showed slightly negative growth over the past 12 months – “a very difficult period” for the WA market, Collins notes. Nonetheless, Collins says he has no doubt that Dianella will be a top-performing suburb over the next three to five years.

Hegney Property Group
Paul Sparta and Simon Moore of Hegney Property Group suggested North Fremantle and Hamilton Hill for the Hot 100, both of which showed slightly negative growth according to RP Data figures.

"I would firstly like to preface my comments by stating that there are lies, damn lies and then there are statistics,” says Sparta, pointing out that Real Estate Institute of Western Australia figures suggest that between June 2007 and June 2008, Hamilton Hill had a median price growth of 2.2 per cent and North Fremantle of 3.6 per cent.

“In the medium to long term, we are still of the opinion that due to their locational characteristics and their position in the property life cycle, these areas should perform well,” Sparta says.

Australian Property Monitors
A number of suburbs Australian Property Monitors (APM) submitted to the Hot 100 have showed negative growth. An APM spokeswoman says this is “simply due to the sudden change in the market”. She says APM made its predictions based on a mathematical model based on historical trends and growth.

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