Which amenities really drive capital growth?
Highly desirable amenities
While the demographics of the area will ultimately dictate which amenities are important, the following are appealing to most people and are correlated with price growth.
You can’t underestimate the importance of good transport links since they can take you to whatever amenity you need.
“The more frequently people visit an amenity, the more important that amenity is,” says Jeremy Sheppard, creator of DSRdata.com.au.
“We usually travel to work five out of the seven days in a week. But we might only shop once or twice a week. So you could say that proximity to work, or to the transport mode that gets us to work, has an importance factor of five out of seven,” he says.
For families, proximity to good schools is a top priority says, Sheppard.
“The kids may make their own way to school or may need to be dropped off. But again, this is a five days a week event so it’s also very important,” he says.
Shopping centres, supermarkets & coffee shops
Both renters and buyers are attracted to areas with easy access to shopping centres, supermarkets and coffee shops.
Many people will have a big grocery shop once a week, but pick up a few extra supplies or forgotten items during the week too.
Coffee shops are a sign of culture, gentrification and nearby employment. Their presence reflects the economic and social activity of the area.
Bodies of water
Bodies of water are in demand, especially beaches. Lakes and rivers with recreational facilities can be huge drivers too.
The larger the body of water is, the better the driver of demand. But even small streams and ponds in large nature reserves make an area appealing for its recreation potential and beauty.
Here are amenities that still carry some weight.
Although not everyone takes advantage of a public pool or a nature reserve, most people may rate the time spent there very highly.
“Some people like to be defined by the lifestyle area they’ve chosen: Surfer, shopaholic, cyclist, party animal, etc. A person’s identity carries a lot of weight in their choice of location,” says Sheppard.
Young families may not be the biggest demographic, but they do drive demand. So child care centres are important.
“If the buyers who are pushing values are buying family homes, you need to consider the availability of childcare, education and family-related offerings,” says Cate Bakos, founder of Cate Bakos Property.
Good bars and food
Whether you’re a foodie or not, if the ‘foodie’ demographic are attracted to an area, they will bring their money along with them, says Bakos.
“Young professionals with a focus on lifestyle spending represent a boon for a popular or gentrifying area. Even as tenants, they push up rents and make investing in the area appealing for investors,” she says.
Well-serviced train stations
Having a train station is not enough. It also needs to be well-maintained and serviced.
“If a train station lacks parking, has infrequent train schedule, requires a change of trains, or feels unsafe, this will have an impact on desirability for a commuter, whether they are owner-occupiers or tenants,” says Bakos.
“Lack of desirability spells lack of demand, and in turn lower growth. On the flipside, a convenient, safe, well-serviced station is a drawcard for commuters.”
Although hospitals are infrequently visited, people feel safer having one nearby. But the real benefit of having a hospital in the area is the pool of tenants and economic activity it creates.
It’s mostly aesthetics, but tree-lined streets are highly valued by buyers and some foreign buyers as well, according to Miriam Sandkuhler, director of Property Maven.
“A beautiful, consistent, tree-lined streetscape is a proven driver of demand. But you want the consistent type of architecture within the street as well,” she says.
Parking is especially important in denser areas, particularly neighbourhoods close to other transport links like train stations or close to shops.
RSL and sporting clubs
Bowling greens and RSL clubs serve a number of entertainment purposes.
However, some clubs can grow too big and create congestion and noise in an area.
There will always be people who want to be closer to the airport because they work there. An airport also creates a lot of economic activity via flow-on businesses.
But Sheppard points out that airports are a tremendous source of noise which makes their benefits overrated.
A post office is infrequently visited by most Australians. But it still has relevance for at least another decade.
“Australia Post is trying hard to extend its services to bolster revenue. But the benefit of having one within walking distance is probably overrated,” says Sheppard.
Places of worship
The “no religion” group is a fast growing group in the religious genre of the census.
Keep in mind that many people claiming to be a member of a religious group may only visit their place of worship once or twice a year anyway.