Magill SA Property Investment

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## 2. Market Overview - Median house price: $1,402,918 - Median unit price: $733,140 - 1‑yr price growth: +18.1 % - 5‑yr CAGR: +5.4 % per annum - 3‑yr growth forecast: +13.5 %

The suburb has posted strong recent upside (18.1 % in the last 12 months) and is projected to keep expanding at 13.5 % over the next three years. Days on market is not supplied, so we cannot quantify buyer‑seller balance, but the rapid price appreciation signals a seller‑favourable market at present.

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## 3. Rental Market - Median weekly rent: $700 / wk - Gross rental yield: 2.6 %

Vacancy rate and demand rating are not disclosed, so we cannot attach a numeric risk premium. The 2.6 % yield is modest; it suggests investors should rely more on capital growth than on cash flow.

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## 4. Short‑Term Rental Opportunity No data are provided for nightly STR rates, occupancy, or estimated annual STR revenue. Consequently we cannot quantify an STR versus LTR comparison. In the absence of STR evidence, the default strategy is to treat the property as a long‑term rental (LTR) asset.

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## 5. Infrastructure & Growth Drivers The supplied data set does not list specific projects, transport upgrades, or employment hubs. Without those details we cannot attribute demand to particular infrastructure or job‑creation drivers.

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## 6. Bull Case Assume the 3‑yr growth forecast of 13.5 % materialises each year:

Potential upside: ≈ $645,000 (≈ 46 % increase) over three years if growth holds.

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## 7. Risks | Risk | Quantified aspect (where available) | Comment | |------|--------------------------------------|---------| | Yield compression | Current gross yield 2.6 % | If rent growth stalls while prices stay high, cash‑flow returns could fall below the 2 % threshold many investors target. | | Vacancy uncertainty | Vacancy rate not supplied | Lack of vacancy data makes it harder to gauge cash‑flow stability; a rise above 5 % would pressure yields. | | Supply pipeline | No data on new dwellings | An influx of new houses/units could dilute demand and curb price growth. | | Interest‑rate sensitivity | Not quantified | Higher rates increase borrowing costs, which could dampen buyer demand and compress price growth. | | Single‑employer exposure | Employment base not disclosed | If the suburb relies heavily on one large employer, any downsizing could affect both price and rental demand. |

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• Entry range – Target houses around the median of $1,402,918 and units around $733,140.
• Minimum yield to target – Aim for ≥ 2.6 % gross; a higher net yield (≈ 2 % after expenses) improves resilience.
• Watch signals

• Recommended strategy – Acquire a quality house or unit now to lock in the current median price, then hold for 3‑5 years to capture the projected 13.5 % annual growth. Supplement cash flow with the existing 2.6 % gross yield, and monitor the watch signals to decide when to exit or refinance.