Zetland the riskiest off-the-plan suburb in 2018

Zetland - part of the Green Square precinct in Sydney's inner-ring - has been labelled as the riskiest off-the-plan suburb in 2018 in an analysis conducted by RiskWise Property Review.

RiskWise analysed more than 3000 suburbs in an attempt to identify the Top 100 Oversupply Danger Zones across the country.

It says more than 315,000 units have been approved for construction across Australia over the next two years.

Zetland tops the list, which is dominated by suburbs in Sydney and Brisbane.

There are currently nearly 600 apartments for sale in Zetland, and surrounding suburbs, on realestate.com.au.

"Taking out number one spot is Zetland, a former industrial zone 4km south of Sydney’s CBD," Doron Peleg said.

"Now in an advanced stage of gentrification as part of an urban renewal project, the residential development of choice has been high-density units and apartments, with more than 5000 new units in the pipeline across Zetland and neighbouring Waterloo since 2016," the Riskwise report advised.

The Green Square urban renewal area – encompassing Waterloo, Zetland, and parts of Alexandria and Rosebery – is forecast to record a near tripling of its population from 21,000 people to more than 61,000 within 12 years.

Some, like Symphony built by Meriton, are ready to occupy.

Off-the-plan projects include Waterfall by Crown Group in Waterloo, four towers ranging from seven to 20 storeys. 

Natural features are centred on a tranquil internal lagoon, lush rooftop escape, tropical bamboo walk, and a 22m high cascading waterfall.

Mirvac's multi-million dollar Ebsworth building has been described as the crown jewel in the City of Sydney's Green Square development. All 174 apartments offered in Ebsworth were sold off the plan in 2015, and completed last year.

Mirvac also secured a near sell-out of Ovo, Green Square with a reported 221 of the 224 apartment Ovo apartments sold in 2015, with an expected completion by early 2018.

Ovo comprised six open plan one bedroom apartments, 46 one bedroom apartments, 152 two bedroom apartments, and 20 three bedroom apartments located at the northern end of Green Square Town Centre.

First home buyers paid $700,000 plus for one-bedroom apartments without parking in what will be the tallest Green Square Town Centre tower.

There are three suburbs from Queensland that make the top 10.

Adelaide, Melbourne's Southbank and Perth have also been pinpointed as the highest risk across the rest of the country.

Brisbane was always likely to be a contender as one of the high risk, particularly with the likes of the RBA and BOQ highlight their concerns for the amount of apartments.

Riskwise suggest :inner-ring demand doesn’t extend to units" with CBD units delivering poorer capital growth than units in the middle ring.

It cites prime examples of poor growth as Melbourne’s Southbank, and Fortitude Valley in Brisbane, with negative growths of 1% and 4.8%, respectively.

"In 2017, more than 5300 units were completed in Brisbane, with another 11,000 in construction.

"What we’re currently seeing on the market is a lot of incentivised advertising, from offers of full furnishings included to a free car on settlement," Riskwise advised.

"A significant number of new developments have led to very high supply of units in NSW, VIC, QLD and WA.

"In many areas inside these states, there has been major oversupply, inflicting significant losses on investors.

"High supply in our major cities, particularly in the CBDs, has often impacted capital growth and rental returns, leading to the instatement of lending restrictions.

"The strength of the units market must be assess on the suburb by suburb basis.

"This slowdown is likely remain at least in the medium term."