WA Perth market 2019

Discussion in 'Where to Buy' started by Rex, 2nd Jan, 2019.

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  1. Shogun

    Shogun Well-Known Member

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    Failed shared equity loan?
    Public Trustee?
     
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  2. Westminster

    Westminster Tigress at Tiger Developments Business Member

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  3. DAZ79

    DAZ79 Well-Known Member

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    According to ABS Index, Perth (Sep 18 latest data) has gone back to September 2012 prices.

    https://www.perthnow.com.au/busines...dys-and-corelogic-report-finds-ng-b881066942z

    Corelogic has Perth at 2009 prices
     
    Last edited: 7th Jan, 2019
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  4. MTR

    MTR Material Girl Premium Member

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    But all markets across Australia have softened and its one common denominator …… the credit squeeze, we wont see any improvement in any markets until we see this ease.

    There is demand in Perth inner city desirable locations, houses, however its still price sensitive and still not back to price points of 2007 when the market peaked

    MTR
     
  5. DAZ79

    DAZ79 Well-Known Member

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    It’s a bit more plain vanilla in Perth.

    Investors are MIA because the market shat itself.

    If rents edge up this year, demand will increase accordingly.

    With prices this low it’s hard to see how credit would be as much as an issue as it in in Sydney etc.
     
  6. Rex

    Rex Well-Known Member

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    True, but for your average income household with an existing PPoR loan now struggles to get a second loan for the purchase of an IP in the new lending environment. This effectively limits most households to owning only one property, which cuts a lot of potential investment buyers out of the market.
    Obviously not as big a problem as in Sydney & Melbourne, but I think tight credit will continue to be a big factor weighing on Perth investor-heavy markets, unless regulators open the lending floodgates in response to the east coast declines.
     
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  7. marmot

    marmot Well-Known Member

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    Personally I think the problem was caused by to many local investors piling in after seeing what happened in the years leading up 2007 and many more got caught up in the media hype in 2013/14 ,thinking that property was going to skyrocket again, but when all the (short term) construction jobs disappeared and many started to move on, the market fell of a perch.
    The problem with taking shortcuts and buying IPs while still carrying large debt on your PPOR, leaves you wide open if the market stalls for a long time,more investors will sell up as their IPs turn into duds,keeping stock levels high.
    Its not like 15-20 years ago where by the time you realized your IP was a dud it was virtually paid off and you were under no real pressure to sell and just kept on collecting the rent.
    Many investors today would have properties for 10 years and never have touched the principle of the loan, so the pressure to sell is higher in a dud market , at the same time they are still paying off their PPOR.
    It might look good on paper having a PPOR worth 500k with a loan amount at 250k , but that 250k still has to be paid off , whilst you are sitting on an IP that's still worth about 500k and you have to pour money into something that hasn't moved in price in years, for some their looking at 10 years of little growth.
     
  8. MTR

    MTR Material Girl Premium Member

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    Yes, if investors can not source loans due to new lending criteria they cant buy....more supply comes to market

    Developers are also struggling in current environment to source loans, in particular for 4+ units

    Not to mention those interest only loans now reverting to interest and principal thats an additional 40% on loan repayments
    This is huge
     
    Last edited: 7th Jan, 2019
  9. Aaron Sice

    Aaron Sice Well-Known Member

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    Land prices are still WAY too high here as well.

    I have the opportunity to get a free, older home (in amazing condition) and after re-clad and transport will be in the hole about $45k. Not bad for a 3x1 with 2x WC.

    Trying to find land? Everywhere is too expensive - I can't even break even.

    There's $20k difference between buying one in a suburb and buying land-only putting a $45k house on it.

    Might have to employ a "lowball like never before" strategy.
     
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  10. JohnPropChat

    JohnPropChat Well-Known Member

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    Is this a mobile home? I've been thinking about that for a while but haven't pulled the trigger. Buy an absolute dud house for below land cost (as land-only is selling for a premium), demo (or retain) the existing house and put a mobile 2x1 or 3x1 and rent it out. Or even a container home.

    Not sure how Councils will take it though.
     
  11. Aaron Sice

    Aaron Sice Well-Known Member

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    No not a mobile home - house on stumps.

    Sea containers are banned for residential use in most LGAs now.
     
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  12. Rex

    Rex Well-Known Member

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    Yes land has not dropped in price much compared to houses and units, in fact in some areas (established areas) I have observed vacant blocks to be selling for more than they did 5 years ago whereas houses on comparable sized blocks in the same suburb are well down. Probably the FHOG keeping up demand / propping up prices I suppose.
     
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  13. Joshua Boctorani

    Joshua Boctorani Member

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    The Perth recovery was definitely hindered by the restricted lending conditions over the last 12 months - but because of the depressed housing prices over the last 5 years, Perth households would have been paying their mortgages off quicker & not over-leveraging themselves like the east coast population. The fundamentals are there but the sentiment just isn't.
     
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  14. Westminster

    Westminster Tigress at Tiger Developments Business Member

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    @Aaron Sice would it fit on this very very very irregular shape block?
    36 Clevedon Place, Kallaroo, WA 6025
     
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  15. Shogun

    Shogun Well-Known Member

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  16. Aaron Sice

    Aaron Sice Well-Known Member

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    Thanks..... but already looked at that Northam lot. Not a triplex because of the bloody canal adjacent and not a good end of town.
     
  17. Aaron Sice

    Aaron Sice Well-Known Member

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    Lol how funny is this lot?! DC2.2 "Regular lots only" my butt!!

    The house is pretty much 11.5x11.5 so not likely.
     
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  18. Aaron Sice

    Aaron Sice Well-Known Member

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    This is close. Duplex lot - put the house facing Stevingon on as small a lot as realistic and sell the Brookton Hwy lot, as large as possible, for $125k.

    Prob only worth $175k, not $199k.

    11 Stevington Street, Kelmscott, WA 6111
     
  19. Westminster

    Westminster Tigress at Tiger Developments Business Member

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  20. JohnPropChat

    JohnPropChat Well-Known Member

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