WA Rockingham WA - What’s the big deal?

What’s the big deal with Rockingham WA? Why do so many people reckon that it’s an investment hotspot? Terry Ryder says so, Arjan Palliwal and Kent Lardner (PropertyNerds, Investor Kit, Suburb Trends websites) mentioned the same too. There are many articles stating the same too.

I know it’s affordable and close to the beach, but why do people reckon that this is the next growth hotspot? How about other affordable areas close to the city, beach and river (the trifactor) like Westminster, Balcatta, South Lake, etc.? By close, I mean within about 15 mins. I am from Sydney, so I know 15 mins may seem a bit far for West Australians, but not for us.

Links: Australia's Top 10 locations for Property Growth in 2021 | Meridien Group

https://www.canstar.com.au/home-loans/top-property-growth-locations/

Above articles may have the same source and may just be recycled info!

 

Its not if …… its already happening

google suburbs in Rockingham….. go to realestate.com, most will be under offer

Many areas in Perth are hot. Rockingham in particular Cooloongup, low entry, close or positive cash flow

https://m.realestate.com.au/buy/property-house-in-cooloongup,+wa+6168/list-1


Set dates ….. mean we will see multiple offers

 

I'm really not sure, I'd say it's because of the low price point to get in and higher yield.
In the 2016 census, 37% were rental properties. I'd say that's closer to 40-50% now.

Not sure I'd be wanting to hold an investment property with that many investors when the market changes. If it's a house to live in and lifestyle change, then it doesn't matter as much.

Just my opinion

 

Sometimes, cynical hat on, when someone says it will be a hotspot enough people listen and buy into said hotspot and it's become a self fulfilling prophecy.

I suspect when the Ryders of the world talk about Rockingham they are referring to the LGA and not just the suburb. However I totally agree with you that for the same price you can buy stuff in other areas that are closer to the CBD and is personally where my preference lies

Perth is currently a very hot market in most suburbs. Lack of new listings is causing a lot of competition so Rockingham LGA will naturally also see some growth.

I suspect a lot of Eastern States investors will causing some of the competition in the area. They are buying sight unseen, they don't know the market, it seems comparable distance to the CBD that they are used to and it's by the beach - what's not to love?!?!? <insert sarcasm>

I'm not saying that you can't make money in lower socio economic areas - heck my username is after the suburb of Westminster - I would just suggest a lot of caution if it's not your hometown and you don't know what you're getting in to.

 

Another reason I was asking this question is that I don’t see certain key metrics indicating strong capital growth in this market right now. I don’t see reducing drastic changes with decreasing Days on Market, rising rental yields, rising Property Values, etc.

 

If you’re using those metrics, you’ll be way too late to the party by the time those statistics catch up with what’s happening on the ground.

Case in point is anything in Perth right now. The stats are hilariously lagging.

 

If not for those metrics, what other metrics do you use then and if I may ask - what’s your source for those metrics? I want to invest in a rising market, not necessarily something at the bottom. Perth bottomed out in 2015-16 or thereabouts (not sure exactly when), so if I had invested then, I would have had to wait another 5-6 years to see any growth. That’s why I want to invest in a rising market (7:30 in the so-called property clock); markets that are already showing some growth and that’s why I am relying on these indicators. I have been looking at the Rockingham market since March this year, and haven’t found significant price movements. I have moved on and purchased properties in Sunshine Coast and Adelaide instead. I got one more up my sleeve before I tap out my borrowing capacity, hence, I was looking at Perth.

 

It is hard to find stock. You need to have a relationship with a few agents and be prepared to say yes pretty quick and without too much homework.

Everybody l with a listing is holding out putting it on market. Maybe with will change early summer.

Anyway - it is not how I like to operate.

 

There is low stock…. Simples

We sold a house in Rockingham 12 months ago, I kid you not today this property has gone up by $100,000.

Not sure why people are getting caught up with why Rockingham???? Rather than acknowledging there is a demand, where do you buy at this price point with a beach at your doorstep

 

I'm from the east coast. I've never been to the Rockingham LGA. I bought sight unseen.

Why?

- cashflow positive from day 1, great tenants signed up before settlement
- rapidly rising sold prices in the past 6 months I've been monitoring the market
- no possibility of more land releases in the immediate area, and the beach isn't getting any further away
- ticks the boxes for a low-risk, "set and forget" investment for me... big block, solid house, very close to beach, schools, transport, local jobs and within commutable distance to Perth (just about).

and... there's nowhere on the east coast I could spend $400k and get all of the above.

No regrets - I'm looking for another place now.

 

Simple economics:
Low supply + high demand = price growth

Yes, there is low stock (low supply), but is there really high demand?

Hard to believe that your property has gone up $100k, but I believe you though. Instead of looking at just one property, let’s consider the entire market. Just looking at the recent CoreLogic report, Rockingham is ranked 127th in terms of Capital Growth in WA.

There are so many places around Australia with beaches at the doorstop, but that doesn’t necessarily mean there is incredible price growth. Beaches, existing train stations, existing shopping centres, existing hospitals, and all existing infrastructure doesn’t reflect in price growth. If there is new infrastructure being built, then it is likely that there will be price growth.

 

I remember when Mandurah was a hot spot!
Rockingham beach is gorgeous. Lovely gentle beach, cafes beside it. There is businesses that take you out in a boat where you can swim with the wild dolphins (and penguins if you are lucky). Little boat tours to Penguin Island where you see sea lions, etc. It’s a lovely place to visit. It’s an area that tends to be affected by wild storms.

A lot of FIFO workers choose to live at Baldivis . If investors are worried by fluctuations with the mining industry they should really keep this in mind! It’s a long way from the city and the airport. There is a lot of vacant land and new estates. Just Google, “Baldivis land for sale”. I would invest in a suburb within 15k of Perth before considering Rockingham area.

There were investing companies buying large amounts of houses in Baldivis around 18 months ago below replacement cost.

Edit- left out Baldivis and added more

 

i take stats with a grain on salt. When we sold we had 2 offers in 3 weeks, but it was not a hot market because there was more stock available, I believe it was the beginning of market moving. Its the lower entry level that is attracting FHB, investors my opinion

 

Rockingham has north facing beach why it is extraordinary. I am a fan of Palm Beach, now we are talking different price point

https://rockingham.wa.gov.au/events-culture-and-tourism/visiting-rockingham/tourist-attractions

 

This is where you need to consider the LGA vs the suburb. And when people come on here talking about Rockingham and the articles it appears to be in reference to the shire/LGA. The LGA is composed of:
East Rockingham
Rockingham
Hillman
Baldivis
Cooloongup
Golden Bay
Karnup
Keralup
Peron
Port Kennedy
Safety Bay
Secret Harbour
Shoalwater
Singleton
Waikiki
Warnbro

Now between those suburbs there is a huge breadth of diversity and price points - even within the suburbs. Something beachside is much more expensive than something more inland within the same suburb.

We are getting a lot of people looking for a $350k bargain in this area and I would caution they move carefully as it's outer areas like this which tend to get slammed a lot more when the market turns however there are some nice pockets at higher price points that are nice.

If you consider the number of rental or sales listing from 12 or 24mths ago you should be seeing a difference indicating constrained supply. You probably won't see it in the last 6mths as it was already constrained.

Reiwa stats might help to see some of the variations within the LGA?
This is Rockingham suburb reiwa.com - Suburb profile for Rockingham
This is Cooloongup suburb reiwa.com - Suburb profile for Cooloongup
This is Shoalwater suburb reiwa.com - Suburb profile for Shoalwater
etc

Some suburbs have already grown quite a bit in the last 12mths and who knows how much growth they have left in them.

 

On the ground you see a property you are interested in sell for 10% more than asking price, then a week later a similar property comes on the market. Everyone who missed out offers another 10% on top of he last property they missed out on. It’s not happening in every suburb in Perth but I’m seeing it quite a bit and the stats will be out in about a month so anyone looking at the last reported stats won’t even get a look in.

 

yes
House sold one street from me 11 offers. Then another hit market which got record price for this particular street, I think again 12 plus offers

There is no stock, I am talking houses. When a house comes to market everyone is pouncing on it

Units are getting trashed. Dime a dozen

 

it's a common trend in multiple metropolitan areas for free standing houses. It's going to get worse too!

 

Yes I think we will see more upside

 

I am a local property manager in Rockingham (WA); and we have a 0% vacancy rate, with rents increasing significantly (21%+). We have qualified prospective tenants that are very desperate for rental properties and are willing to pay above the advertised asking price. A lot of our investment properties are also being leased without being advertised online.

The demand is extreme.