Red Head NSW Property Investment

THE MARKET

Red Head has compounded at 1.6%/yr over 5 years — a house that cost $842,877 in 2021 is worth $912,500 today. Properties are sitting on market for 30 days (roughly balanced conditions). At the same growth rate, today's median reaches $987,874 by 2031.

- **Median house:** $912,500 | **Units:** $0 - **Gross yield:** 3.5% | **Net yield:** 2.0% - **5yr price CAGR:** 1.6%/yr | **3yr forecast:** 1.8%/yr

- **Supply pipeline:** Moderate — Development activity consistent with long-term averages

RENTAL SNAPSHOT

- **Vacancy:** 3.0% (stable) | **Rental demand:** Moderate - **Median weekly rent:** $0/wk | **Days on market:** 30 (stable) - Tenant market — vacancy elevated, negotiate hard on rent.

SHORT-TERM RENTAL

- **Median nightly rate:** $195/night | **Occupancy:** 68% - **Estimated annual STR gross:** ~$48,399/yr - **vs long-term rent:** $0/yr (comparable — LTR offers simpler management)

INFRASTRUCTURE & CATALYSTS

- No major confirmed infrastructure projects on record. - **Transport:** Standard suburban transport access

BULL CASE

If Red Head maintains 3%+ annual growth and vacancy stays below 2.1%, median prices could reach $1,049,375 within 3 years with yields compressing slightly as capital values rise.

BEAR CASE

A market correction or interest rate shock could see prices in Red Head pull back 10-15% from $912,500, with vacancy rising to 5.0% and rental yields softening as tenants gain leverage.

KEY RISKS

- No significant risk factors identified for this suburb

COMPARABLE MARKETS

- **Mittagong** (NSW): $1,100,000 median, 3.2% yield, 12.9% 1yr growth - **Leppington** (NSW): $1,000,000 median, 4.2% yield, -5.5% 1yr growth - **Merimbula** (NSW): $900,000 median, 4.0% yield, 1.0% 1yr growth

THE PLAY

Red Head offers balanced fundamentals but does not present an urgent buying signal. The market is in a growth phase with moderate vacancy risk. Monitor vacancy trends and price movements over the next 6-12 months. Only enter if a property can be acquired at or below median pricing with yields exceeding 4.0%.

- Entry range: $821,250 – $1,003,750 - Minimum gross yield to target: 4.5% - Watch signal: vacancy dropping below 2% and days on market holding under 35

This analysis is for informational purposes only and does not constitute financial, legal, or investment advice. Seek professional advice before making investment decisions.