WA Perth Market 2022

Discussion in 'Where to Buy' started by MTR, 1st Jan, 2022.

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  1. Rooky

    Rooky Well-Known Member

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    Stats are not accurate for Perth. Corelogic had some issue with their daily index for Perth. They have still not fully explained that. I guess same for monthly data.
     
  2. thatbum

    thatbum Well-Known Member

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    Honestly without any more details, that sounds like a very average /below average IP purchase.
     
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  3. Polymath

    Polymath Active Member

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    Do you mind disclosing which BA you used? Would you highly recommend their service?
     
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  4. JKB

    JKB Well-Known Member

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    yes that is right but things have improved significantly in last year or so.There has been next to none development in last five years, at the moment first home buyers are paying premium to secure brand new villas or even near new villas are achieving decent price if you have hard working agent on your side. Whoever secured a development site in the area in downturn are reaping rewards now. Prime example is below whole development sold within three days once completed. Site bought for $270k, two villas sold for $410k each third one under offer.

    https://www.realestate.com.au/property-villa-wa-balga-138157038
     
  5. MTR

    MTR Well-Known Member

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    excellent
    Around 30% profit
     
  6. sash

    sash Well-Known Member

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    How you getting the numero?
     
  7. MTR

    MTR Well-Known Member

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    rough estimate

    Land $270k
    Builds $600k
    Infrastructure $55,000
    Hold costs $35,000

    does not include gst/selling cost/taxes


    Sale price. $1,230,000

    i may be off on the build? Not sure. Spec looks good

    oops. demo $15,000?
     
  8. Perky29

    Perky29 Well-Known Member

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    These guys here.
    Liz and Trevor were excellent.
     
  9. sash

    sash Well-Known Member

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    Here my numbers
    Land $270k
    Builds $660k (more expensive for site/landscaping, fencing, etc)
    Infrastructure $55,000
    Hold costs $35,000
    Demo $15,000
    Sell costs $25,000
    GST assuming using margin scheme $20,000

    So total is $1,080,000

    Profit of 150k ....nahh......I am making ore than that on one H&L.;)
     
  10. MTR

    MTR Well-Known Member

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    I wonder about build costs? Build costs cheaper 18 months ago

    Not sure what these rent for $420 each?


    But as a hold cash flow positive
     
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  11. sash

    sash Well-Known Member

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    Even 18 months ago...you would be over 200k....even house and land product say 165sqm...on small block would have been about 205k...but if it older add another 15-20k minimum. Now you would be looking easily at 24-250k each minimum!
     
  12. PropDir

    PropDir Well-Known Member Business Member

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    Thanks @Westminster - how about the reliance on mining industry in WA? Is WA/Perth's economic base expanding to other industries outside of mining/minerals etc? And all of the stuff happening with China and their trade relationship with Australia seems concerning.

    That's the only issue I can see with WA, aside from this all of the other points made in this thread and others point to positive prospects for WA/Perth.
     
  13. JKB

    JKB Well-Known Member

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    Hi Sash,

    You are obviously doing very well and better than most here. Even as a local in Perth I could never spot an opportunity to make $150k profit on house and land in Perth, as I don’t have knowledge you have about H&L. Your numbers are absolutely correct according to your knowledge, however they might be different for someone who does it day in day out. As much as I know

    Purchase price including stamp duty & legal costs= $285k
    Build = $600k maximum including demolition (considering construction start time)
    Infrastructure+ planning ( watercorp, westerpower, planning and permit fee, plans) = $35k
    Holding cost = $35k
    Selling fee = $25k

    Total Cost = $ 980k

    profit = $250k or 25% and taxes payable as required, same as any other development or new build.
     
    Last edited: 2nd Jan, 2022
  14. MTR

    MTR Well-Known Member

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    Right, I was about 5% out


    If this was a different suburb I would hold all as positive cash flowing and access equity
     
  15. sash

    sash Well-Known Member

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    Even in today's market or 18 months ago? Wow that seems pretty cheap.

    Does that include paving...landscaping...reticulation....fencing? I was building 4x2x2 2 living area plus study about 215-220sqm...for 227k and 235k...now I am looking at 250k plus minimum spec'd up!

    Might have to start some villas developments.....:D
     
  16. Westminster

    Westminster Tigress at Tiger Developments Business Member

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    The whole of Australia has a reliance on the resource industry and agriculture. Without them the whole nation would feel it.

    Yes of course there are other industries here
     
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  17. PropDir

    PropDir Well-Known Member Business Member

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    @Westminster yes of course I understand - however Perth has traditionally been highly reliant on its mining industry, which explains the massive rental yields and capital growth increases that occurred in 2005-2007 from which point there were big falls and if you look at prices in Perth now, they haven't grown anywhere near the extent to other cities such as Sydney, Melbourne and Brisbane.

    So my question is given Perth has traditionally not had highly diversified industries in comparison to other cities, does this high reliance on one industry continue to remain as a risk for sporadic price movements, or have things changed that will provide more stability to Perth going forward.

    Perth may well be due to a price upswing, but I am just trying to understand this point better.
     
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  18. JKB

    JKB Well-Known Member

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    Certainly construction was cheaper then.

    $420/week easily but as you mentioned better to keep it moving in the area unless you have to hold.
     
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  19. MTR

    MTR Well-Known Member

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    Why do we have to keep explaining this:confused: its frustrating
     
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  20. MTR

    MTR Well-Known Member

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    Yes, the concern is too much of the same product
     
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