What is Gentrification?

What is Gentrification?


As a property owner, there are endless terminologies that we need to be aware of to be an astute, educated, and successful investor.Rental yields, ROI, depreciating assets, right of entry, emergency repairs, equity, line of credit, capital gains, comparison rates, cross--collateralisation, loan-to-value ratio, and offset accounts are just a few, which we have mentioned in prior issues of our newsletter.

So what is gentrification? 

Gentrification is the movement of affluent residents into lower socioeconomic area and the changes that occur due to the influx of wealth. 

Most investors know that if they purchase a property right before a shift begins in a suburb they can capitalise greatly from the opportunity. The challenge is, knowing how to identify one before it happens.

The signs of gentrification of an up-and-coming suburb usually happen just outside of affluent areas where you will start to see the emergence of modern infrastructure construction, greater employment opportunities, population growth and government or businesses willing to invest sizeable money into building a shopping centre, local amenities, and restaurant/social districts. 

These suburbs can also be run-down with lower socio-economic housing, where there is a ripple effect outwards from wealthy suburbs that cannot sustain the population growth for the area.

Keeping up to date on developments and local planning through the council or utilising online resources such as property information websites can assist you in being able to identify if an area is changing. You can also research if incomes are increasing, unemployment is decreasing or the level of education among residents is improving.

While an area may seem undesirable now, the astute property investor will look a few years into the future.

If you would like to know what suburbs we consider to be up and coming, please give us a call on 9756 3040 or send us an email to [email protected]

Francesca Luccitti
0430 393 396
[email protected]
Shop 8, Greystanes Shopping Centre Greystanes NSW 2145
181 Dunmore St Wentworthville NSW 2145