Hey guys,
Just doing some research on Geraldton and chasing information from any local minds or people that have recently or historically purchased here.
Lots of dodgy commission areas for sale which wouldn't touch but some great places closer to water, strong yields, well serviced with relative low vacancy rate. Although Oakajee project is on the back burner still seems to be a lot going on.
looking at renovation project that would be cashflow positive on a 700sqm block that has potential for future subdivision or development.
Thoughts people!
You need to understand the drivers that underpin that market and where you'll be in about 5 years.
WA in general is coming under increasing pressure as the resource construction boom unwinds. I would tend to wait and see on Geraldton. It has the potential to be a trap. With that kind of risk profile I don't see the returns reflecting the risk
If you like resource centric regions then Newman is a far better bet. Reinhart is continuing with the Roy Hill expansion ($8-12B) and FMG look like it will have it's debt burden under control by mid 2014 if ore prices stay above the $110/dmt for the short term. That suggests things will be fairly stable in Newman for the near term. The big if is the sheer amount of oversupply (iron ore) coming onto the market over the next 18 months. Either prices or volumes will fall perhaps both. I don't see Newman taking a hit though. It's survived the downturn till now relatively unscathed. It wasn't over built in residential like Karratha and Port Hedland.
I don't see anything other than stable steady growth in Newman regardless of the economic climate.
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