WA Perth bottoming out?

Discussion in 'Where to Buy' started by Paterson00, 7th Feb, 2016.

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  1. Mikasa

    Mikasa Member

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    Yep. Myaree one on a buzy road.

    I believe it's been rezoned already Melville local planning scheme 6 gone though back in May 2016.

    Even the neighbour suburb Winthrop was rezoned from R17.5 to R20. Lots of big corner lots there circa 800sqm, not sure if it's worth subdividing. Any info on this suburb?

    Also I looks like the places closer to public transport have been rezoned to higher density.

    The council mentioned that they planning for rezoning for apartments with commercial units on ground floor and it seems that they developing Willagee too? Did a recent search on public housing in willagee and found that it's now down to 200+ houses. From memory back in the early days it was circa 500.
     
  2. Gen-Y

    Gen-Y Well-Known Member

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    Words on the street about Perth - the residential construction is almost dead.
    Alot of material supplier are fighting to stay afloat and cutting cost as much as they can.

    How's the mood on the street with buyer of the end product - completed residential?
     
  3. euro73

    euro73 Well-Known Member Business Member

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    I can only tell you what I'm seeing and hearing from valuers... everything I'm doing in Perth right now is valuing up, and more than that, I'm seeing a lot of Cat 2 and Cat 3 risk ratings - which on brand new dwellings is a sign of a very stable market where valuers aren't at all concerned and are taking a position where they are building in some extra backside protection.

    Not seeing any Cat 4's and certainly not seeing any 5's - and in particular I am seeing a lot of 2's for Market Segment Conditions. That's a very positive thing. And it's being reflected by what I'm hearing from the valuers on the ground as well, when I speak with them .... They ( and by they I mean JLL, Opteon, CBRE, LMW etc) are all telling me the market is really stable, and prices have bottomed 6 months ago...

    The areas I am referring to where I am experiencing this include Rockingham, Gosnells, Brabham, Dayton and Madeley...

    Whether that sentiment is shared by Perth based PC members is a different story, and whether other parts of Metro Perth are seeing this stability and valuer support, I cant say.... but based on the suburbs listed above at least, the evidence I'm seeing from valuers, who are closer to the action than any of us, suggests that broadly speaking, Perth appears to have bottomed already and represents good buying right now.
     
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  4. Perthguy

    Perthguy Well-Known Member

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    I think it definitely depends on the product and the area. In the last couple of months I have inspected 2 development potential (retain and build potential) properties in the same street in Cloverdale and both had deals fall over due to low valuations so were back on the market. The first one got withdrawn from sale with the owners putting it up for rent and I bought 50% of the other one :p
     
  5. Big Daddy

    Big Daddy Well-Known Member

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    I'm still seeing daily price discounting in the inner suburbs. I thought we needed construction to stabilize and pop growth to increase which leads to increasing rents to see the start of a recovery. Has Perth turned the corner? It feels like 12 months away but that'd a gut feeling and not as solid as first hand advice from local valuers
     
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  6. mrdobalina

    mrdobalina Well-Known Member

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    What do these categories mean?
     
  7. Gen-Y

    Gen-Y Well-Known Member

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    Thanks for the update for the on the ground scenario.
    I would of thought a supplier struggling to keep afloat and scratching to gain work would be an indicator to whats to come for the next 12 months.
    If that isn't picking up for them - how is it going to translate to house price growth?
    Is Perth operating on a different parameters to the rest of Australia?

    Just trying to learn a few things from those on ground - moving and dealing.
     
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  8. Perthguy

    Perthguy Well-Known Member

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    On the ground it feels like property is still slow and declining. But I am talking closer to the city than @euro73, so it could definitely depend on the product and location. I mainly look at development potential older houses closer to the CBD. These have suffered a lot in the last 2 years and continue to decline.
     
  9. euro73

    euro73 Well-Known Member Business Member

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    Low risk. These are the kinds of risk ratings you want on resi property valuations
     
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  10. Jamie_

    Jamie_ Well-Known Member

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    All lower socio areas, more cheap NRAS :p?
     
  11. Jamie_

    Jamie_ Well-Known Member

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    Not sure how accurate this is... from what I've seen over the last year, prices have gone up not down for construction materials (timber, stone, decorative surfaces, hardware) whilst there are more cheaper alternatives around, the reputable brands have still gone up in price. If suppliers are struggling to stay afloat, then i presume it's just those poorly run who are finally getting caught out.
     
  12. mcarthur

    mcarthur Well-Known Member

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    As of today, I thought there wasn't any more NRAS available...?
     
  13. Aaron Sice

    Aaron Sice Well-Known Member

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    they're still there....!
     
  14. wogitalia

    wogitalia Well-Known Member

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    Those are some of the worst suburbs in WA as far as desirability so there's probably a strong case that they are close to rock bottom given they've always been the low cost, low risk areas.

    Would be very interested to know the ratings that some of the more expensive suburbs are turning up.

    Would be very interested to see the number of building services companies going into liquidation. I've had one client who has had 4 different customers go broke (all building services as opposed to end clients).

    The vibe that I get talking to those involved in the construction industry is that it's an absolute bloodbath right now and margins are getting pummeled. Same client above has had to reduce margins from 20% a year ago to trying to make it work at 5% to try and tender for work now. Am having far too many meetings involving what liquidation means and whether they should do it.
     
  15. stockt12

    stockt12 Member

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    Has anyone recently purchased an apartment in the cbd and/ or within 10km of cbd? Heavy deal negotiation because of demand(lack) ? Agents thoughts ? Looking at a purchase due to good yields but seeing a few fire sales.
     
  16. Big Daddy

    Big Daddy Well-Known Member

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    No sorry. Can't help.
    On a side note my wife is seeing a noticeable pickup in land sales , 5 in my shortlist out of 6 dev sites within 10km of cbd ( 500 to 800k) went under offer in past 2 weeks and HTW has changed property clock for Perth to 'approaching bottom' . Is it just the end of financial year or the election or nothing (just coincidence)
     
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  17. Big Daddy

    Big Daddy Well-Known Member

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    My lowballing is not working. I wait until a property is on the market for atleast 4 weeks then offer 5% under price (written if they will take it, else verbal if the agent suggests ) and the last few times the property is under offer within 2 days (used my offer against me with buyers on the side line ) I think I'm a crap negotiator
     
  18. mrdobalina

    mrdobalina Well-Known Member

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    Do you think the yields will hold up?
     
  19. stockt12

    stockt12 Member

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    Yes . Comparitavely the numbers vs the bigger states are solid and minus the east Perth corridor(which will be flooded over the next 36 months) the rest of the close to cbd investments look good.(not from commercial standpoint, that looks awful )
     
  20. Big Daddy

    Big Daddy Well-Known Member

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    What areas in particular in the east?