Investing in Perth or Eastern States

Given the current market there are some good deals if your looking to buy on the flip side leasing is tough.
Do you think there is more sense in investing in Sydney or Melbourne where the market is alot better but paying a higher premium over buying something in Perth hoping the tenants will stay on at the end of their lease?

 

A lot of this will depend on what your budget is, and what your investing timeframe looks like.

Sydney's at the same point Perth is in my opinion.

Melbourne is going great but you have to understand which pockets are good and which are already overpriced.

Leaves Adelaide, Brisbane, Canberra, or regionals, do some reading of the threads in the Where To Buy section of the forum and you'll get many varied opinions on all.

 

Don't touch Perth, it's still falling

I would look at middle ring Melb lower end properties, 15-17 km, North is still cheap compared to other areas which has experienced significant growth.

FHB are now driving this market which is huge

Do your own homework

 

I'd buy in Perth before Sydney - Sydney is at the peak where at least Perth is closer to the bottom of the cycle. I'm not too familiar with Melbourne.

Which area in Perth are you thinking? Now more than ever I think liaising with PM's to get a really strong idea about tenant demand (both vacancy rates and the types of properties they want) is vital - it's the best way to make sure you won't be left with an empty house.

 

I would avoid Sydney and Melbourne at the moment. I'm not that familiar with the Perth market so I would avoid that too. But there are plenty of other places to research.

 

I'd be purchasing in Brisbane BCC precinct. Its well poised for CG in the short term if you are looking to leverage further to build a substantial size property portfolio.

 

Commercial property is a different ball game. Vacancy rates are on the rise. Smaller companies moving to more prestigious locations for similar rents. Unless you know your market very well - stay away from commercial property.

As for Resi - Perth is a falling market so unless you get a really good discount - stay away. I did notice a lot of very keen vendors so low-ball away. I expect at-least a 10% drop in prices by end of next year but some vendors are in a panic and discounting more than 10% so you may get lucky.

 

Newbie Q... BCC? Only guess is Brisbane City Centre or Council.

 

Brisbane City Council

 

Plenty of places on the East coast besides Sydney and Brisbane to research as well.

 

I am looking to buy in Perth in the next 12 to 18 months and I agree with this. It seems like the market is still falling to me too. There are stories of problems in the near city apartment market which will likely impact the wider market. I would use the time to find out more about the Perth market and how it works.

 

I assume the OP is talking about commercial properties, local resi issues are irrelevant surely?

 

Dunno. I didn't pick that up from the first post. OP will have to confirm.

 

It's in the commercial section of the forum so id assume thats the case

 

Will be a good exercise in patience/discipline. Try to pick the bottom

 

Not sure about smaller stuff but at the big end Perth has a way to go down in commercial just yet I think. There's a lag with longer leases entered a few years ago by resource companies and support industries taking space whenever/wherever they could at inflated rents with no incentives and a lot of these leases will be coming to an end in the next couple of years.

At the same time, cap rates across the country have been falling rapidly, but this doesn't make so much sense in Perth with such risk to income.

Could be good value found in the coming couple of years?

 

I think Bibra Lake will be one of those "missed that boat!" comm locations.

Roe8 is a medium term inevitability and Bibra Lake is primed to capitalise on that.

I'm looking into smaller places for purchase and subdivision again - affordable small business is almost an oxymoron in this state.

things become affordable for small businesses and owners increase their sq/m rates.

 

Omnidragon aka deltaberry buys CIP in Melb, I am sure he said its hot.

Perhaps search his posts