WA Port Hedland time to invest?

Hi all,

What is everyone’s view of investing in Port Hedland WA now? Recent trends show not only have house prices stabilises but starting to slightly go up first time since 2013/2014.

 

probably 12 months ago was the time but still good buying
I would want a 10 % yield or something I could add value to.

There might be easier places to make good yields though....

 

The time is about to begin again when a few of the so called experts will start spruking the mining towns

 

Terry Ryder is already back spruiking Muswellbrook as it’s done 14% in the last year.

 

With 80% of the market being renters, you'd have to be an idiot buying there imo as an investment. Not to mention a 100 other reasons. Some ppl will never learn.

 

I know quite a few people up there, and it's the owner occupiers who are buying there at the moment more than investors. Or, OO with a long term investment view.

Lots of offers - it's competitive for the good properties.

 

Yep its buy time. Port has already moved, you won't find the bargains of say 6 months ago. South H and Karratha are still good buying. Gladstone is moving too now.

 

Yes. People have such a short memory. It’s moving where? Is there another mining boom coming? Heeyaa!

 

My memory is long. It’s moving where? Well, the asking sale price, the asking rent price, sold prices and rental yields are all moving up. Vacancy rates and stock on market are moving down. Iron Ore prices have doubled in the last year. Rio has committed to 100 million odd dollars investment into Karratha in the next 5 years and surrounds and BHP has done similar in Port. Many people don’t realise that in bust times more millionaires are created than are lost. This was true in the Great Depression and the GFC. People that invested in the US after the GFC have done extremely well in both stocks and property. Even Detroit has turned the corner, perhaps the worlds biggest basket case in the last decade.

 

All general statements. There is nothing attractive in Port Hedland other than dust. It might see spikes but it would be highly speculative spikes.

OO drive prices, Port Hedland barely has any OO.


No one wants to leave there. As soon as investment dries up or kids grow up people leave that place.

Money still can be made but it is a highly speculative and unpredictable market. There is no reason it will be heading anywhere.

 

Yes, in 20...

 

It was similar as to when I was living out in central Queensland, the town locals were buying several of the properties as bargen prices as they have seen the mining towns go through several boom and bust cycles

 

it' not for everyone but the smart money will do well there
probably already made 20% equity gain and sitting on a rental of 12%+
if you make 4% on your city rent you still need to have 6-8% growth to make the same on your return - not taking into.account leverage which can change the equation

 

Thanks for all your responses so far seems there’s both sides to this.

Strongy1986 based on your comment above what is your view of the below property purchased for $570,000 with long term rent $1150 per week.

Happy to hear anyone else’s view.

reiwa.com - 38 Dempster Street, Port Hedland

 

Mining towns are like developments, only can be more treacherous. If you get into one and it doesn't meet your risk profile you can be in big trouble fast. It's not an area of 'investment' to be taken lightly in the least. It's a specialised area requiring a detailed plan of entry, monitoring and exit. Assuming it really meets one's risk profile. That's my view on it.

 

I'm with @Leo2413. Too risky for me. What's the use with high yields if the value if the underlying asset drops 50% or more? And what happens when the mining boom is over? Are you still going to be owning an asset with tenants paying high rents?

 

I'd need a lot more than 10% yield to be interested - too much risk and hard work to get in and out at the right time

 

To be honest, the yield is not there in these towns for the most part at the moment. Especially for units, the strata is a killer. However, the prices for both sale and rent are well below their long term averages. Below pre-boom. There is no boom anticipated in the near future, but there will be moderate capital gains and rental increases to be had in the next 5 years with a very low entry point. The appeal is moderate growth with low investment rather than speculative purchase and hope for boom.

 

That is understandable. But my question is where the growth will come from? There are little that would drive any growth other then speculation that the boom will bring people into these towns.