High crime suburbs outperform the market
Investors have been urged to look past crime statistics.
Investors have been urged to look past crime statistics.A news study by RiskWise found that high-crime areas outperformed the five-year median property price growth in capital cities. In Sydney, eight of the top 10 high-crime areas outperformed the market. The RiskWise study put the performance down to the demand for affordable housing.
"Investors commonly attribute too much weight to crime figures and should more objectively analyse the financial risks when making property investment decisions," RiskWise chief executive Doron Peleg said.
Peleg said affordable high-crime areas with "significant gentrification" produced strong growth, particularly when inner and middle ring suburbs in a capital city were severely unaffordable.
"Busby in the western suburbs of Sydney is another example. This suburb consistently endured some of the highest gun violence rates across the city, yet it delivered growth above the median for Greater Sydney," Peleg said.
"In summary, our research found affordable high-crime areas with significant gentrification are likely to produce strong median price growth. Whereas suburbs with high-crime and low-gentrification typically deliver growth below the city benchmark, such as in Osbourne Park, Perth."
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