Hillsborough NSW Property Investment

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## 2. Market Overview | Metric | Figure | |--------|--------| | Median house price | $992,573 | | Median unit price | $829,432 | | 1‑year price growth | 5.5 % | | 5‑year CAGR | 6.5 % / yr | | 3‑year growth forecast | 13.5 % | | Days on market | *Data not provided* |

What it signals - Buyers face modest price appreciation (5.5 % over the past year) and a forecast of 13.5 % over the next three years, suggesting there is still upside but no rush to lock in a bargain. - Sellers can price competitively; the growth trend is positive but not explosive, so buyer demand remains steady.

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## 3. Rental Market | Metric | Figure | |--------|--------| | Median weekly rent | $615 / wk | | Gross rental yield | 3.2 % | | Vacancy rate | *Data not provided* | | Demand rating | *Data not provided* |

Implication for investors A 3.2 % yield indicates a neutral cash‑flow position after typical financing costs. Without vacancy data we cannot quantify risk, but the yield suggests the market is neither highly attractive nor unattractive for long‑term rental (LTR) investors.

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## 4. Short‑Term Rental (STR) Opportunity | Metric | Figure | |--------|--------| | Nightly STR rate | *Data not provided* | | Occupancy (average %) | *Data not provided* | | Estimated annual STR revenue | *Data not provided* |

Conclusion Because STR metrics are unavailable, we cannot model an STR cash‑flow scenario. With a modest 3.2 % LTR yield, the default recommendation is to focus on long‑term rental until STR data becomes available.

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## 5. Infrastructure & Growth Drivers *No specific infrastructure, transport projects, or employment‑base data were supplied.*

The 13.5 % 3‑year growth forecast implies that some combination of local amenity upgrades, population inflow, or employment growth is expected, but the exact drivers cannot be identified from the provided data.

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## 6. Bull Case Assume the 3‑year forecast of 13.5 % materialises and rental fundamentals stay unchanged.

• House price upside: $992,573 × 1.135 ≈ $1,126,600 (≈ + $134,000).
• Unit price upside: $829,432 × 1.135 ≈ $941,000 (≈ + $112,000).

If the gross yield remains at 3.2 % and rent rises in line with price growth, annual rental income could increase from $31,980 (615 × 52) to roughly $36,300, pushing the yield to about 3.2 % (still modest but with higher capital gains).

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## 7. Risks | Risk | Detail (numbers where available) | |------|-----------------------------------| | Vacancy risk | No vacancy rate supplied; a rise above the norm could push net yield below 3 %. | | Single‑employer dependency | No employment‑base data; if the suburb relies heavily on one large employer, any downsizing would affect both price and rent growth. | | Supply pipeline | No data on upcoming developments; a surge in new housing could dilute price growth and increase vacancy. | | Rate sensitivity | With a 3.2 % gross yield, a 1 % increase in borrowing cost could erode cash flow, especially if vacancy rises. |

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## 8. The Play - Entry price range: - Houses: $900,000 – $1,000,000 (around the median). - Units: $750,000 – $850,000 (around the median).

• Minimum yield target: ≥ 3.2 % gross to stay cash‑flow neutral under current financing assumptions.

• Watch signals:

• Recommended strategy:
• - Hold existing positions and consider incremental acquisition if prices dip into the lower end of the entry range while the 3.2 % yield is maintained.
• - Prioritise properties with strong tenant histories to mitigate unknown vacancy risk.
• - Re‑evaluate the suburb if STR data emerges that suggests a higher net return than LTR.