Infrastructure efforts help to lift market performance in the state, and the timing could be right for investors
Perth has come out on the other side of its prolonged struggle, and plans are in place to keep its upward momentum going.
“The state government’s International Education Strategy and Graduate Skilled Migration list that was introduced in 2018, along with changes to immigration policies by both state and federal government in 2019, could be the catalyst for an increase in housing demand,” says J-Han Ho, property researcher and senior lecturer at Curtin University’s School of Economics, Finance and Property.
Ho goes on to outline the perks Perth could provide to buyers.
“Perth’s housing market is very attractive when you consider the cost of housing, distance from the CBD or major activity centres, housing quality and size, and amenities available in every precinct,” he says.
Developments lift prices
Planned mining investments and the development of retail centres should serve to enhance the job market in the state, as well as boost consumer confidence. The infrastructure investment along Perth’s northern coastal strip has also been pushing dwelling values up in that pocket.
According to Real Estate Institute of WA figures, the suburb of Two Rocks had the fourth-best housing market in Perth in the second half of 2018, as prices went up by 6.4%. Meanwhile, Yanchep saw the third-largest increase in land prices, which saw a 5.5% boost.
According to Jarrod Rendell, project director for the Atlantis Beach and Capricorn Beach estates in these two suburbs, the significant infrastructure initiatives in the coastal area have been a major drawcard for buyers, along with the low property prices. These projects include both transport developments and new educational institutions, such as the Atlantis Beach Baptist College in Two Rocks and the Yanchep Secondary College.
“There is strong potential for current property buyers in the Two Rocks/Yanchep area to achieve strong levels of capital growth moving forward, because property prices in this prime coastal strip are still well below average Perth property prices,” Rendell says.
“As a result of this new infrastructure combined with its attractive coastal lifestyle, more families are moving into the area, which is now beginning to result in a lift in property values that over time will increase further as the area becomes even more popular with property buyers.”
SUBURB SPOTLIGHT
KALBARRI: An up-and-down market
The suburb of Kalbarri in Perth’s northwest region has had a fairly rocky ride over the past few years. House prices, for instance, have ricocheted between positive and negative since 2013.
The current median house value sits at $273,722 after a drop of 2.8% in the year to December 2018, stopping the positive momentum the market experienced in 2015. On the other hand, unit growth was in the positive column, recording a boost in prices to over $150,000.
This type of property also offers incredible rental returns. In fact, Kalbarri’s 10% average unit yield as of December 2018 is one of the highest in the state. However, the average weekly rental rate slipped by 2%.
Growth: Kalbarri has shown a volatile growth pattern in recent years
Yield: The rental yield for a typical unit in Kalbarri is an incredible 10%
