Perth Suburb Selection

Hi AVS
For units close to the city in Perth you could try.

Mt Lawley
South Perth
Como
Mt Hawthorn
Inglewood
Maylands
Yokine
 
As far as houses go I really don't know where you would be able to purchase at $400k within 10 km from Perth CBD.

Rents are very strong at the moment. I would try to buy in smaller complex 6-8 units.

Happy to help if you have any further questions. I am from Perth.

Cheers, WI

Hi

I've been living in Perth for about 2 years now – moved from NSW. Your overall selection of Perth as a city to invest should be a good one based on what I'm seeing here compared to the Eastern states. Perth is a young growing city with massive opportunities in the future – while people talk about China only in terms of resource demands, Perth is also well located to Africa and Indonesia – two places that will need resources in the future.

In terms of what the market is doing in general ,I live in Kensington and places there are definitely selling a lot faster this year than they were last year – a sure sign the market has improved.

Do the research and good luck.

TheBish

WA is one big mining town and as far as mining towns go they do provide higher risk than might otherwise be expected. One could argue that WA’s economy is reasonably diversified, however, a substantial portion of GSP (Gross State Product) is predicated on business investment.

…from WA Treasury – Economic notes 2010 -11

On an expenditure basis, the major driver of real growth in the State’s GSP was business investment,
growing by 12.6% over the year and contributing 3.0 percentage points to the 3.5% GSP growth rate.
This was followed by household consumption, which grew by 4.5% over the year, contributing 1.8 percentage points.
State Final Demand (a measure of domestic demand in the State) grew by 6.5% in 2010-11, contributing 5.8 percentage points to annual GSP growth. However 22.2% growth in the balancing item detracted 4.1 percentage points from GSP growth during the year.

? On an industry Gross Value Added basis, the main driver of real GSP growth in 2010-11 for Western Australia
was from output in Mining, which contributed 1.6 percentage points to the State’s overall GSP growth of 3.5%.
While output from other industries was mostly positive during the year, output in the Agriculture, Forestry and
Fishing industry and the Wholesale Trade industry fell, detracting 0.6 and 0.1 percentage points each from GSP growth. Several other industries such as Accommodation and Food Services, Public Administration and Safety
and Arts and Recreation neither added to, nor detracted from, GSP growth.

The conclusion one can draw from the above is that mining and oil/gas infrastructure expansion projects are the main drivers of the WA economy. The big mining projects are scheduled to wind back within 2 years although FMG has plans for the next 5+. I’m not convinced FMG will be able to pursue its expansion strategy as aggressively going forward as it has in the past for a variety of reasons. Oil and Gas has some big projects on the go now that will take at least 5 years to complete but I doubt they will have much affect on Perth property if at all.

I tend to think things are finally balanced at the moment and that much depends on how China handles the global downturn. For an investor its more important than ever that any PI strategies are well thought out and include worst case scenario planning. There’s been a slight uptick in the Perth market and rentals are fairly buoyant at the moment but unless fundamentals start moving in a positive direction soon I don’t see those as sustainable at current levels.

I’ve talked to several business owners in recent weeks from Welshpool to Mandurah and they’re all on the edge financially. They certainly aren’t optimistic at this point.

Hi AVS

If you look hard enough you can buy 2 bedroom unit in Mt Lawley in certain pockets for under $400K which could represent reasonable value and one bedders for under $300K.
http://www.realestate.com.au/property-unit-wa-mount+lawley-110986399

States $420 pw rent which would be about right.
This location is reasonable, more of an older style flat, but in this area this is the norm, this is blue chip area and units are in big demand and tight rental market.

Not sure how many units in this block though, however, I know this location may be worth looking closer at this.

Cheers WI

I  like the older units, art deco etc. As far as thes types of units go they are very much in demand and there is a short supply of these, they get snapped up as soon as any hit the market, as they are in leafy sort after areas surrounded by period homes. They also tend to have larger floor plan which is an added bonus.

If you are looking at a newer construction and villa or semi detached I would look closely at Yokine, 7 km from the city, nice area and very good value at the moment. Many developors have jumped into this area and built some nice high spec homes which has helped maintain a good feel to the area.

Out of the areas you mentioned Cloverdale would be my pick, however this would be for house on development site not unit.

Thornley and High Wycombe can not comment, not sure how you would go for growth in these areas, nothing extraordinary as far as I know.
However, when buying interstate which I have on a number of occasions it is very easy to get confused when you start looking at too many areas. Personally I find it is easier to focus on 1 or 2 areas, get to know them well, there is no need to rush it is not a rising market, you have time on your side. Also, have you networked with a couple of RE agents this can be very helpful, make sure you phone quite a few ask the same questions, keeps them honest, just some suggestions.

Does this suit
http://www.realestate.com.au/property-villa-wa-yokine-111020791

or this, tad over $400K

http://www.realestate.com.au/property-villa-wa-yokine-110681785

Cheers WI

Cross Bentley out of your list. High crime rate

Dianella and Morely (and inglewood) are all good suburbs but don't get too close to the Maylands boundary

I would pick the development property which will provide ultimately the better return and opportunity to add value which of course makes it unique and sort after. This is what will add value regardless of whether you choose to develop or not.

However in saying this the figures would need to stack up now, in other words if it is costing too much to hold until you can build it may not be viable.  This is where you need to research areas with potential and work out whether the figures stack up for you now.

Areas like Ashby, Sinagra personally do not hold much charm for me because one is totally relying on growth and those areas do not have any unique value as far as I know, ie period homes, close to city etc…….. 

WI