Property Coldspots

Whilst Mt Isa may be the worst place to buy a house, Sydney's western suburbs dominates a list of 13 of Australia’s top no-go zones for residential real estate investors according to Real Estate specialist Terry Ryder.

His report also states that Bankstown offers "a smorgasbord" of reasons not to buy, and the Blacktown/Mt Druitt region is regularly held up as an example of society gone wrong, however harsh that may seem. Ethnic tension, high crime rates and aircraft noise are the main reasons for property investors to shy away from Bankstown, and Blacktown/Mt Druitt is not much better.

"Imagine living in an area where there's an arson attack on a home every second day," Mr Ryder says.

Inner-western Chippendale, which is the site of a planned $2bn redevelopment of the former CUB brewery, is Australia's best investment opportunity according to Ryder. "Parts of the inner west and inner south show plenty of promise," he says.

Only two other major capital areas - Melbourne's Lyndhurst and Brisbane's Dinmore - are listed as no-go zones for potential investors, which Mr Ryder says he has made from observations of the real estate market based on 26 years experience as a real estate researcher, writer and investor.

Mr Ryder runs a website that attempts to identify areas of property growth before the growth happens. He says his list of the worst places to invest is designed to aid buyers to avoid investment property where prices could plummet. "Investors can make big money buying in the right places at the right time," he says. "Equally, they can lose money by buying in the wrong places."

The Sunshine Coast is somewhat of a surprising inclusion to the bad list. This is because of affordability and infrastructure, an oversupply of apartments and marketing practices used by real estate agents, which are considered dubious.

Other zones to be wary of as a property investor are the northern suburbs of Darwin and the Northern Territory's Katherine. This is due to a mix of defence-induced inflated property and social problems.

Buyers are also urged to shy away from flood-prone Giru in Tropical far north Queensland, crime-riddled Shepparton in regional Victoria, and over-priced and polluted Esperance and Kalgoorlie in Western Australia.

Mr Ryder believes that outback Queensland mining city Mt Isa is the worst place in Australia to invest. As well as having the most polluted population centre, Mt Isa has above average and over stated prices and low rental returns.

Below is the full list of places to avoid according to Mr Ryde: • Bankstown, western Sydney, NSW

• Blacktown, western Sydney, NSW

• Darwin, northern suburbs, NT

• Dinmore, Brisbane, Qld

• Esperance, southeast, WA

• Giru, north Qld

• Kalgoorlie, outback WA

• Katherine, outback NT

• Lyndhurst, Melbourne, Vic

• Mount Isa, western Qld

• Parramatta, western Sydney, NSW

• Shepparton, northern Vic

• Sunshine Coast, Qld