Property investment in Newcastle – The threat that lies beneath
The property investment journey can produce a roller coaster ride of emotions, especially for those who find themselves in uncharted waters. For first-time investors the initial thrill that comes when they burst out of the gates and begin searching for potential opportunities, is often replaced by fear and frustration as they begin to encounter the many unforeseen bumps, blind corners, and sheer cliffs that exist as risks on the path to success.
In Newcastle not only do we need to be aware of, and manage all of the typical risks that come with investing in property, we have something else altogether frightening. A threat from deep below, that just about everyone purchasing property in Newcastle must contend with – mine subsidence . Whilst fairly well understood by most Novocastrians, mine subsidence is a risk that looms large for anyone who doesn’t know where to look, or who to go to for help.
A quick insight into mine subsidence:
The city of Newcastle was subject to enormously extensive coal mining efforts that spanned from the 1830s through to the 1960s. Prior to the growth of the city and the establishment of many of the homes, major buildings, key local infrastructure and community assets, coal mining activities were widespread. The result?
- Major economic benefits to the town in years past; and
- Land below ground that now looks like swiss cheese due to the deep and unstable mine shafts left behind. This is a situation that can present significant problems for anyone wanting to build, renovate or extend properties in the present day.
Just ask Syrian billionaire and hotelier Ghassan Aboud who recently purchased the former Newcastle City Council building with plans to turn it into Newcastle’s first 5-star hotel. What Aboud didn’t see coming was the multi-million dollar price tag associated with structural rectification of the centuries old mine shafts that lay under the future hotel site – a requirement imposed by the mine subsidence authority of NSW as part of town planning approval Aboud is seeking.
The good news? Remnant mine shafts need not cost you in the same way they have cost Aboud. Particularly if your focus is on investing in low-rise (below 2-3 storeys) residential and commercial buildings. There are also some steps you can take to avoid the literal pitfalls associated with the unstable ground conditions created by mine-subsidence:
- Review online mapping to see if the property you are purchasing is within an area known to be undermined – Newcastle city centre maps
- Make contact with the nearest Mine Subsidence Board to obtain further information about risks toy our property.
- Discuss your plans for the property with local council and geotechnical consultants who specialise in mine subsidence research and engineering.
With the support of a great team and a deep understanding of the steps you can take to eliminate or manage risks such as mine subsidence, your next property investment can be the first of many. Just don’t risk it being your last.
Want to connect with buyers’ agents who know Newcastle like the back of their hand? Contact the team at Capital Property Newcastle on 1300 320 153 and book a complimentary property investment planning session today. Leverage our expertise and extensive network to mitigate your risks and maximise your results in property investment.
The publications by Capital Property Investment Advisers are for general information only and are intended to assist you in understanding the nature of the property market. The information contained in this editorial is for Australian residents only. This editorial does not consider your personal circumstances and has been prepared without taking into account any of your individual objectives, financial solutions or needs. Before acting on this information you should consider its appropriateness, having regard to your own objectives, financial situation and needs. This editorial does not constitute, and should not be relied on as financial or investment advice or as recommendations (expressed or implied) and it should not be used as an invitation to pursue any investments or investment services. No investment decision or activity should be undertaken on the basis of this information without first seeking qualified and professional advice. Capital Property Investment Advisers disclaims any and all duty of care in relation to the information and liability for any reliance on investment decisions, claiming the use or guidance of this publication or information contained within it.