WA Apartment in Perth - What Suburb?

here is another example even closer to town - looks like a bargain but doubt it'll even fetch 300 - decently Reno' ones would be low-mid300, not that the address is listed but easier to have a rough guess.

https://www.realestate.com.au/property-villa-wa-bayswater-124370670

 

"Ugly duckling needing a complete makeover".. lol

 

I think the stock has been removed for Christmas and their is not a tonne sub 300k.

I was really leaving towards neds not subi as well.

 

Ok guys, I've listed the suburbs I can afford (300k) in the order of increasing vacancy rate. Next to vac rate is also a household income and distance to CBD:

1. Doubleview 3.7%, 1669$, 11km
2. Glendalough 3.8%, 1579$, 6km
3. Bayswater 3.9%, 1413$, 6km
4. Scarborough 4%, 1627$, 14km
5. Morley 4.7%, 1266$, 10km
5. Osborne Park 5.2%, 1102$, 8km
6. Maylands 5.3%, 1221$, 5km
7. West Leedervile 5.4%, 1927$, 2km
8. Dianella 5.7%, 1290$, 9km
9. Mount Lawley 5.7%, 1715$, 4km

Would it be a good idea to focus on the suburbs from the top of the list? I suppose the answer will be "it's not that simple".

 

I'd leave glendalough off, same with Ossie park because the properties at that price point would be available in better locations in smaller more boutique blocks.

I'd have a look at freo surrounds too and canning hwy suburbs too, that's often not spoke about here but imo significant underlying appeal and the demographic is getting wealthier all the time.

 

This one in Como seems pretty nice:
reiwa.com - 15/26 Baldwin Street, Como

4.5% Vacancy rate though..

 

All vacancies at the moment suck. 4.5% is actually pretty good - some of Perth is over 6%

 

How would you approach Perth market?

What signs/parameters would you monitor to identify the right time to buy?

Some experienced investors here think it's a great time to buy now because of high discounts. What I'd be concerned about is how long the market can stay suppressed for, or even when will it bottom out.

I think I'll wait for vacancy rates to come closer to 3%, wait for some improvement in WA economy and 2 quarters of consecutive house price rises. This way hopefully I'll be able to buy when the market is in the "recovery" phase.

 

@Realist35 Mate it's very hard to guess when would the market be bottomed out. Best bet would be to buy a property that you like and you feel confident of.
I am also looking to buy one in Perth and although looking at houses or villas around 450K mark.
Good luck in finding your 1st IP.

 

That is a sound approach and certainly will minimise risk however as you probably know you'll be paying more than today most likely.

It's a balancing game - low prices but sucky vacancy rates or higher prices and better vacancy rates. The yield may actually end up being the same in both situations though so do check yield as you go along - vacancy rates are for a whole suburb and that doesn't always give a good picture. You may still find a good yield if you shop smartly and find a bargain

 

Vacancy rates aren't everything either...

I think (someone chine in here if I'm wrong) but it also depends on the type of property as well.

In a lot of places close to CBD s now there is a high vacancy rate due to the large number of dogboxes that have been built. But what if you manage to buy a house there? You can bet that'll rent out in an instant.

That's an extreme example, but it does translate......eg....buy a townhouse in an area full of unit blocks.

Normally the stats and sentiment lump townhouses/Villas/duplexes together with units and it drags their price down along with everything else during a slump. But I'd argue that something with a little land is more livable and more rentable.

Hope I'm making sense?

 

Thanks hammer, that does make sense.

I'll be looking to buy an apartment in the near future and I've been stuck thinking how to choose a suburb that has lowest supply of apartments. I decided to watch the parameter "ratio of apartments" for the suburb. The lower the better.

I also think townhouses and Vilas are much better option than apartments because you own more land.

 

Dont forget that with apartments, things can change literally overnight. All it takes is one or two developments....

 

Everyone will have a different opinion and of course I'm no different

I am completely unfamiliar with the Perth market and vacancy rate is just one factor that I would take into account...

... however, I wouldn't dream of touching a suburb with a vacancy rate of over 5% let alone 3%!!! This is a huge red flag and I'd be asking myself what evidence I had that this would be changing any time soon. eg., imminent population boom, infrastructure improvement etc

The absolute max vacancy rate I would consider for an IP would be 2%... BUT even then I would still be aiming for less than 1%.

Just my very honest thoughts...

 

Thanks mate.

Would that mean you wouldn't buy in Brisbane? Because you would be struggling to find a suburb with such a low vac rate.

Also when vac rates are as low as you said, that's normally reflected in high house prices as well.

 

I haven't researched Brisbane recently, so I couldn't really comment but I do like Brisbane and think it has a lot going for it. However, I'd still be aiming for a 2% or less vacancy rate regardless of city.

Both of my buys were less than 350, 000 and in middle and outer Melbourne, so not high house prices at all. In addition to price (aim for less than <$350) and vacancy rate, I take into account yield as a filtering tool as I prefer not to have an impact on my lifestyle and that works for me.

My impression is that you are still researching far and wide.... may I ask why you have specifically chosen Perth and the apartment market?

 

A BA is looking for a house for me in Brisbane, and that's gonna be my first IP.

With regards to PPOR, I'll most likely choose an affordable apartment in Perth and use the equity in it to invest. This way I don't have rent to pay and no non-deductible debt. I'll also most likely be able to take 105% IP loan using the equity in the apartment.

However I won't buy in Perth until the market improves.

Hope all this makes sense.

 

This is the type of property I will be looking for in about 12 months time. It has a lot of potential but it's on the wrong side of Beechboro Road South for me. Still, 800m from Bayswater Stn would mean at least having a look to see what needs to be done. Overpriced IMO but the vendor could be motivated? According to the script, the 'owner just wants it SOLD' but it was last purchased for $115,000 so $299,000 might be a bit of a stretch in that condition? Why not buy it and renovate it to look like the nice Como apartment?

Of course you would lowball.

U 2/41-45 Avenell Road, Bayswater, WA 6053 - View Sold History & Research Property Values - realestate.com.au

 

Agreed. I would just have to involve tradies as I have no reno skills myself. Also living in regional WA I'm not sure how manageable it would be.

Why is it on the wrong side of Beachboro Rd though?

 

Too close to the industrial area and too many units in that section... check out the aerial photos.

I have found property values are lower on that side of Beechoro Rd Sth and higher closer to Beaufort St and South-West of Coode St.