WA Perth Market

We all know that the Perth market is not doing so great at the moment and the upper end, $1M+ has still not completely recovered since crash of 2007, but the price achieved for this property is outstanding in the current market.

I have been watching the progress of this property for years now. The owner had rented it for something ridiculous $20 per week to students, it is an absolute dump, at one stage prior to last tenants leaving there was no power to the house.

The owner wanted to bulldoze it and build a new mcmansion therefore was not concerned about maintaining the property.

Over 20+ years there has been no maintenance to this property. Council would not allow the property to be demolished, even though roof is being supported (seen in link), not sure if its structurally sound?? BWT not a development site.

Settled last week, sold for $1.4M, new owners will not move in for another 2 years as they have a $1M reno happening.

Hope this is a good sign and we will see this market start to move, some how I doubt it

http://www.wayneheldt.com.au/2286842/

MTR

 

Yup, it's not so happy at the moment.

At the lower end of the market, I have a property there that rapidly went from $335k to $425k 2013-2014, and having a look around at comparable is probably still about the same now. I tried to rent for $430pw but could only achieve $400pw after a bit of vacancy.

 

You guys willing to make a call when the bottom is in the Perth market?

I would like to buy one there at some stage but don't know if it's got more to fall..

I can't see what will drive the prices up at this stage, no good news stories?

 

There's different pockets and price brackets obviously, but the parts I watch it seems mostly negative news at the moment, with prices remaining steady. Once the current developments come online, the vacancy rate increases (already at 20 year high) and people start to sell it'll go down a bit I think. Check this space this time next year.

 

Mind sharing the suburb?

 

Forrestfield 6058

 

I think Perth is still falling. It'll probably stabilize mid to late next year. Net migration to WA is actually negative at the moment. Early next year will see a few thousands apartments added to housing stock which won't help either.

 

Good choice for long term growth. Lots of infrastructure spending in/around that area.

 

Thanks guys, I'll check back here next year

 

Yeah, can see it happening. There's lots of new people moved into the area recently via new estates which has changed the demographic a little.

It was my PPOR previously so may sell it CGT free. The train station is anticipated for 2020 so maybe the area will boom around then?

 

Agree in terms of apartments oversupply and won't be pretty next year

Perth market rose from 2012-14, and it's not unusual for markets to stay flat for 7-10 years after a rising market. Even so there still may be pockets that will work.?

Some calling 2017 I think forum member shadow has posted charts on his theory.

 

Will have to watch out for the next mining boom in the long term future as well, and what happens in China

 

I think 2017 will be too soon myself, I think it'll take longer than that to recover.

 

Haven't checked the numbers lately but quite a few suburbs are inching towards pre-boom prices. The ones that are showing resistances are the sub-$400k stock and buyers in new estates that are in denial. There seems to be a lot of negative sentiment among investors in Perth which could mean greater vendor discounts but may have to put up with 5 to 7 year sideways growth unless one has the money to develop 4 to 5 unit sites.

I did hear about the 2017 thing, Gateway project hitting some major milestones. Perth stadium completion in 2018 etc. If the China-FTA comes through, Perth may get some boost due to proximity and all.

 

Quite likely. Hoping for a Perth-wide boom before that time as well

 

I am cautious because we have great exposure to China. I see lots of downside in our economy at the moment and the job losses is huge.

My focus in particular is to develop in Perth over the next 18 months, but then again the numbers have to stack up.

I checked my numbers with Willagee, developing 3 villas, interesting enough I can get the build with high spec now at $1050 per sqm, pretty damn good, however my concern is selling the product? will there be buyers? end values??

When the market is depressed its not only a matter of having to reduce prices, its also the fact that there are no buyers in the market. Solution, hold them all?? this does not fit in with my strategy for various reason, I would need to sell at least 2.

Sitting... watching....waiting

 

And if you are to hold - will you have the tenant demand?

Is the vacancy rate increasing?
Rents declining?

 

$1050/m2 is a pretty good number. Mind to share which builder?

How about getting a bit creative and selling them OTP and allowing the buyer "some choice" on the design?

 

Both unfortunately.

 

great price! however, I imagine there is a good reason for this.