Investing in Perth 2014

Just waiting on finance for my ppor in wanneroo. Not strictly an investment but I chose it for all the same reasons.

It’s currently going through rezoning, same as Craigie or Quinns Rocks a little while later. I was looking in Craigie originally but I found the prices there unrealistically high.

Anyone have any thoughts on midland 

We have a 3×1 in Hillman under contract, 

We settled on a 4×1 in Cooloongup in July. Both bought well under market value with a Reno, revalue and hold strategy.

Both +geared! Midland would have been nice to get into before Perth market started to run though lot happening round that end of the world; many social problems and crime but as with most areas with such proximity to the city and well serviced- the lower socio-economic problems will be flushed out over time.

Hi Guys,

My partner and I invest in Perth and focus on subdivisions and renos. Last year we did 2 renos/subdivisions in Bassendean, but now we are looking for the next one Bassendean is not as viable as it was a year ago. Prices have increased too much to make anything worth while and properties are being snapped up in a couple of days.

We have now shifted our focus to areas like Midland, from the numbers I have been doing I think the only way anything is worth while is by doing apartment style developments or townhouses. The zoning is high around the town centre and there is a lot of gentrification going on. Personally I don't see the crime etc has a deterrent – majority of people are looking for affordable houses and these are the areas that appeal. I was shocked though at how much apartments/units are selling for at the moment – off the plan for $300k for a 2×1 and majority are sold.  

Thanks,

Kate

The only one I would consider on this list is Maylands – but my strategy is not to wait for long term growth.

Hi Phorsa,

Our strategy is to renovation and/or subdivide and sell so we are looking only at houses at this stage. Once we have enough capital we will be able to buy properties with good rents and capital growth outright and live of the rent (that's the plan anyway), but right now we are focused on building the capital base.

Thanks,

Kate

Porsha

Some lower entry level areas you may want to consider are:  Girrawheen, Koondoola and Beechboro, these areas have all had significant growth over the last 2 years, however due to proximity to city and rezoning on the agenda they are hotly contested, I think you could source something around $425-450K, renting for $400 pw. Where can you buy this cheap/close to the city. Girrawheen and Koondoola ex-State Housing, however this is changing rapidly with Sattlerly refurbishing houses for Government which are on sold to FHB.

Another one that I would look at is Mirrabooka, once again proximity to city, and excellent infrastructure, currently as cheap as chips, not for long.

Cheers

WI

For clients I have switched my strategy a little due to the rapid growth in some metro markets.

The main fundamentals are:

• Stay within a 15km ring of the CBD, unless going coastal.
• Target areas with a low base
• Seeking areas with low supply on market (Balga etc. traditional has high transaction volume)
• Target land value (70%+)
• Seeking properties with an unrealised additional upside – rezoning etc. (not the stuff in Joondalup as everyone knows about it)

The main thing that has changed is the low base rather than chasing the market up to the $600k+ figures for most full sized blocks close to the CBD.

I also feel that the new budget may result to cuts to first home buyers and if this is the case the would be a good opportunity in the sub $550ks for a few months while that buying group drys up and heads further into H&L.