Previous research has shown that the more affordable areas of our capital cities often excel on house price growth.

This dispels the myth that you need to be close to the CBD to achieve good capital gains.

New research has also refuted another common belief – that areas with high crime rates have inferior capital growth.

Recent data from RiskWise Property Research shows that affordable areas attract strong demand, generating above-average price growth, regardless of the local crime statistics. This is particularly so if a cheaper area is undergoing gentrification.

This correlates with Hotspotting’s analysis that low-priced locations often have strong capital growth, including those stigmatised as problem areas. We often call these locations the “Ugly Duckings’ of real estate.

“Ugly Duckling” is an odd term for something you would recommend to real estate investors. The Ugly Duckling of the fairy tale was considered unappealing because those around it didn’t understand what it was. It evolved into a graceful swan.

There are suburbs within every city that share similar qualities, which some may consider unattractive when looking through uneducated eyes. Yet, they have the potential to transform into real estate swans.

Every major city has suburbs which were once considered “down market” or “on the nose”. Yet, they have evolved into trendy areas. Some examples include Richmond in Melbourne, Balmain in Sydney and Bulimba in Brisbane.

These suburbs, once considered primarily industrial in nature, have changed into thriving residential areas with steady price growth. Often through urban renewal.

There are outlying areas of major cities which have now been “discovered”, transforming their appeal and their property values.

The significance of these areas in the residential market has grown because affordability has become the headline issue in the housing industry. This is one reason why the cheaper areas of our capital cities have recorded good capital growth over time.

First-home buyers, investors and others often target areas like these due to their affordable prices.

Of course, not all the cheaper areas have the potential to evolve into real estate swans. But some of them do. The task for property investors is to identify the ones which have reasons to out-perform the market.

At Infinite Wealth, our team of more than 30 experts are constantly working together to determine the ugly ducklings of the real estate market.

We want you to be the first to know and the first to capitalise on all growth potential.

We consider the powerful combination of affordability, infrastructure, and job growth when recommending investment areas to our clients.

Click here for more information about how we design personalised investment strategies for our clients.