Erskineville NSW Property Investment

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## 2. Market Overview - Median house price: $1,894,933 - Median unit price: $1,138,120 - 1‑yr price growth: 3.4 % - 5‑yr CAGR: 4.5 % per year - 3‑yr growth forecast: 8.8 %

*Signal:* Positive price growth (3.4 % over the last 12 months) and a strong 3‑year forecast (8.8 %) indicate a seller‑favourable market. Buyers face upward pressure on price; sellers can command premium offers. Days on market is not supplied, so we cannot comment on listing speed.

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## 3. Rental Market - Median weekly rent: $950 / wk - Gross rental yield: 2.6 %

Vacancy rate and demand rating are not provided, so we cannot quantify them. The 2.6 % yield, while modest, aligns with inner‑city benchmarks and suggests stable, if not high, cash‑flow for long‑term investors.

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## 4. Short‑Term Rental Opportunity No data on nightly STR rates, occupancy, or estimated annual revenue are supplied. Consequently we cannot calculate an STR gross yield or compare LTR versus STR. Based on the lack of STR metrics, long‑term rental (LTR) remains the default strategy until further market intelligence is obtained.

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## 5. Infrastructure & Growth Drivers The data set does not list specific projects, transport upgrades, or major employers. However, Erskineville’s proximity to the Sydney CBD (within 5 km) and the 8.8 % 3‑year growth forecast imply that location and broader inner‑city demand are the primary growth catalysts.

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## 6. Bull Case If the 3‑year forecast materialises and price growth stays at 8.8 % over the next three years:

• House price scenario: $1,894,933 × 1.088 ≈ $2,061,419 → + $166,486 capital gain.
• Unit price scenario: $1,138,120 × 1.088 ≈ $1,237,000 → + $98,880 capital gain.

Assuming rent holds at $950 / wk, the yield would rise to roughly 2.9 % on the higher price, enhancing total return.

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## 7. Risks | Risk | Quantified Concern | |------|--------------------| | Vacancy risk | Vacancy rate not disclosed; a dip below the suburb average could erode the already modest 2.6 % yield. | | Single‑employer dependency | No employer data supplied; if a dominant employer were to contract, rental demand could fall. | | Supply pipeline | No data on upcoming dwellings; a surge in new units could pressure rents and yields. | | Rate sensitivity | High median prices ($1.9 m house, $1.14 m unit) mean interest‑rate hikes could reduce buyer affordability and slow price growth. |

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## 8. The Play - Entry range: Target houses between $1.8 m – $2.0 m or units between $1.0 m – $1.2 m (around the current medians). - Minimum yield to target: ≥ 2.6 % gross (the suburb’s average). - Watch signals: 1. Changes in the Reserve Bank cash‑rate (impact on buyer financing). 2. Announcement of new residential projects within the suburb. 3. Shifts in median rent or vacancy data from future market reports. - Recommended strategy: Acquire a property at the lower end of the entry range, hold for 3‑5 years to capture the projected 8.8 % capital growth, and collect steady rental income at the current 2.6 % yield. Adjust the portfolio if vacancy data or supply pipeline information signals a shift in cash‑flow dynamics.