Perth Primed for Growth

Perth is coming off the bottom of its property cycle which means it’s a good time to buy into Australia’s fastest growing capital city. 

When people think about Western Australia, they often think about the mining boom, and whether or not it’s over.  This perception has led to a drop in the price for Perth property. However, while Western Australia has undoubtedly benefited greatly from the mining boom, it’s a mistake to think that a city like Perth only has mining going for it.

In fact, mining is only the fifth biggest employer, accounting for only 7% of jobs. This means there are still lots of people looking for places to live.  It also means Perth continues to attract people from both the eastern states and overseas who are seeking work. Despite the end of the mining boom, it remains the fastest growing capital city in Australia. 

While Perth may be at the bottom of the housing boom, developers still have to sell property to service their loans. In some cases, they are offering up to $40,000 discounts on land, which can make a huge difference for an investor.

Vacancy rates are high in Perth but much of this comes from the inner city apartment market, which is over-stocked.  Apartments constitute only 9% of housing stock, but they are 39% of the rental market. This suggests there is still rental demand for family homes, particularly if they have good access to shops, schools and transport. 

Low interest rates, demographic growth and developer incentives and the property cycle means that’s it a great time to buy in Perth.  At Pfeiffer Property we deal with a range of trusted wholesale builders who specialise in building investment properties. They’ve spoken to property managers in WA and used their feedback to simplify their house designs without compromising the build quality. 

Easy and inexpensive changes such as using two split system air conditioners for the home instead of one, making bedrooms a bit bigger and simplifying the design of the garages, not only make these properties more in tune with what prospective tenants desire, but can also shave thousands off the building cost. In some cases property packages are selling for $20,000 below their valuation. 

A thriving city like Perth with its many employment opportunities won’t stay at the bottom of the property cycle forever, and now is precisely the right time to position yourself for excellent long-term capital growth.  Stay tuned. In our next post, we’ll be showcasing some great opportunities for investing in WA.