Payneham SA Property Investment

THE MARKET

Payneham recorded 10.7% annual price growth over the past 5 years — a $1,300,000 house bought in 2019 would be worth approximately $781,997 today. Properties are sitting on the market for 31 days (roughly balanced conditions).

- **Median house:** $1,300,000 | **Units:** $377,599 - **Gross yield:** 2.7% | **Net yield:** 1.2% - **Vacancy:** 0.8% (improving) | **Rental demand:** Very High - **5yr price growth:** 10.7%/yr | **3yr forecast:** 12.1%/yr - **Days on market:** 31 (stable)

STR potential: $155/night at 64% occupancy = ~$36,208/yr gross. Long-term at $34,580/yr may be simpler with comparable returns.

BULL CASE

If Payneham maintains 3%+ annual growth and vacancy stays below 0.8%, median prices could reach $1,495,000 within 3 years with yields compressing slightly as capital values rise.

Notable infrastructure: **Payneham Memorial Swimming Centre Redevelopment** (completed). Plus 3 more projects in the pipeline.

BEAR CASE

A market correction or interest rate shock could see prices in Payneham pull back 10-15% from $1,300,000, with vacancy rising to 1.4% and rental yields softening as tenants gain leverage.

WHAT TO DO

Payneham presents a compelling investment opportunity. The combination of solid fundamentals and very high rental demand supports entry at current price levels. Proceed with due diligence on specific properties. Target gross yields above 2.7% and prioritise properties with value-add potential. Consider timing entry around the current growth phase of the market cycle.

- Entry range: $1,170,000 – $1,430,000 - Minimum yield to target: 4.5% - Watch signal: vacancy staying 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.