{"id":10350,"date":"2017-01-30T01:00:34","date_gmt":"2017-01-29T14:00:34","guid":{"rendered":"http:\/\/realestatetalk.com.au\/?p=10350"},"modified":"2017-01-30T01:00:34","modified_gmt":"2017-01-29T14:00:34","slug":"green-shoots-emerge-in-wa-damian-collins","status":"publish","type":"post","link":"https:\/\/channels.realty.com.au\/realtytalk\/green-shoots-emerge-in-wa-damian-collins\/","title":{"rendered":"Green shoots emerge in WA – Damian Collins"},"content":{"rendered":"

 
\nDamian Collins<\/strong> from Western Australia is a guest today as we reflect back on that market in 2016, the lessons that came from it and Damian tells us that there is some good news on the horizon.
\n <\/p>\n

Transcript:<\/strong><\/h4>\n

Kevin:\u00a0 <\/b>Let\u2019s check in with another one of our experts who we spoke to this time last year \u2013 Damian Collins from a very interesting market, WA, from Momentum Wealth, buyer\u2019s agents in that state.
\nDamian, thank you very much for your company. Welcome to the new year, and happy New Year.
\nDamian:\u00a0 <\/b>Same to you, Kevin, and we certainly hope to see a happier new year than 2016 for people investing in the west.
\nKevin:\u00a0 <\/b>Let\u2019s reflect on a few things that you made comments about this time last year.
\nDamian:\u00a0 <\/b>Well, I think in terms of the Perth market, by the time we get into this time next year \u2013 early 2017 \u2013 we\u2019re going to be saying we\u2019ve just seen the seeds of recovery. In the first half of the year, the market is probably going to be fairly similar to what it was in 2015\u00a0 \u2013 fairly flat and a tough rental market \u2013 but towards the end of the year, we\u2019ll start to see the signs of recovery as rental vacancy has peaked and started to drop back. A bit more confidence back in the West Australian market, and early stages of hopefully a reasonable upcycle \u2013 nothing significant, but a reasonable upcycle over the following years ahead.
\nKevin:\u00a0 <\/b>What about those green shoots, mate? Did they start to appear?
\nDamian:\u00a0 <\/b>Towards the end of the year, Kevin, we saw the median price growth start to tick up. Both [1:18 inaudible] <\/b>and CoreLogic saw growth in the final quarter in the median price. There are glimmers of hope on the horizon. Building approvals \u2013 which is the supply coming into the market \u2013 have certainly slowed down, but we still have low population growth.
\nWe\u2019re at the bottom of the cycle. Exactly where we are is always difficult to say, but 2017 is going to be another year of slow recovery. I\u2019d expect the prices to be fairly stable across the board, but you might find a few pockets here and there where you might do a bit better than the market. In the years ahead, there\u2019s still a strong long-term outlook for Perth, but short term, it\u2019s not going to rise in a hurry.
\nKevin:\u00a0 <\/b>Was it a tougher market in 2016 than what you had anticipated, Damian?
\nDamian:\u00a0 <\/b>It was a little bit tougher, yes. We thought that the market might start to recover, and as I said, the median price showed it did towards the end, but I still think that might be a just quarterly blip.
\nThe population outflow was the big one that I think took people a bit more by surprise. It was evident that with the end of the mining construction boom, we\u2019d see a slowdown in population growth coming in, which we definitely did, but the number of people leaving and going out of state or overseas was higher than most people expected.
\nThat has held back the recovery. Going back 12 months ago, I would have thought coming into 2017, we\u2019d be starting to see it pick up from early 2017, but I still think that\u2019s going to be towards the end of the year or even in 2018 before we see a sustained, across-the-board recovery in the property market.
\nKevin:\u00a0 <\/b>Do you see any opportunistic buying coming into the WA market, given the fact that things have come back a bit, Damian?
\nDamian:\u00a0 <\/b>That\u2019s where it is at the moment, Kevin. As you would know, you have Sydney, Melbourne at the other extreme where people are paying potentially over the top. They\u2019re at the other stage of the cycle, and we\u2019re at the bottom, so we\u2019re certainly getting some really good properties that in a normal market, you\u2019d find more competition, and we\u2019re getting them at exceptional prices.
\nIf you have a long-term vision, the fundamentals are there in Perth. The agricultural sector is going very strongly this year. It\u2019s not just mining. Mining is the big industry. Commodity prices have recovered. As we speak, it\u2019s about $80 (U.S.) a ton and has been for a little bit.
\nThe fundamentals are there. I think it\u2019s just confidence that holding people back. It\u2019s a great year to get those opportunistic ones, lock them away, and if you have a five- or ten-year horizon, you\u2019ll still do well.
\nKevin:\u00a0 <\/b>Can you be a bit specific and tell us where you think some of the best opportunities lie right now in WA?
\nDamian:\u00a0 <\/b>We\u2019re certainly focused on being in proximity to infrastructure and particularly trains and future train lines. Obviously, we\u2019re seeing tourists spending a ton of money in New South Wales and Victoria. As the city gets bigger and more congested, people really focus on that public transport, and that becomes an important determination of where they want to live.
\nPerth is getting into that stage; it\u2019s two million now. We\u2019re focusing up in the Northern Corridor. We still like Warwick and Joondalup and Craigie up the Northern Corridor, and we still buy selectively in Forrestfield. It did have a bit of a run-up with the rezoning; it has come back a little bit, but there is still a train line going out there, which is going to make that area quite accessible to the city once that train line gets built, and it will be up and running in a couple of years.
\nSo really, the focus is on being near that important infrastructure, and still areas that are rezoning. That\u2019s another area we\u2019re focusing on. We\u2019re looking at where prospective rezoning is because that gives you that uplift. Even in a flatter market, we\u2019ve seen some rezoned properties jump 20% or 30%.
\nIt\u2019s really about doing a lot of research and picking out the best properties. The good thing at the moment in Perth is that you can do that. In 12 or 18 months, it will be a lot harder, because there will be a lot more competition.
\nKevin:\u00a0 <\/b>We\u2019re hearing some terrible stories around Australia about the tightening the banks are going through and what flow-through that\u2019s having for a lot of developers. Are you seeing any signs of that in WA at all, Damian?
\nDamian:\u00a0 <\/b>Yes, it certainly has. Because the confidence has been down for a couple of years, developers have really struggled to get projects off the ground. Getting the requisite number of presales has been very difficult, so we haven\u2019t had a substantial oversupply of apartments. Yes, there is a bit of an oversupply, but a lot of the projects haven\u2019t been built. We have more general oversupply in the market, whereas some of the other cities have a particular issue in apartments. So, it has been, and there have been some sales fallen over <\/b>in some development projects, but nothing substantial.
\nBut it certainly has affected investors. We\u2019ve had clients who <\/b>could potentially borrow $1.5 million before the changes; now it has pared back to about $800,000 or $900,000. So, it certainly has had an impact on people\u2019s borrowing capacity.
\nKevin:\u00a0 <\/b>We\u2019ve learned a lot of lessons out of the market of 2016.
\nDamian, all the best for this year. We\u2019ll talk to you as the year goes through, but thank you for giving us your time and your insight this morning on the show. Thank you.
\nDamian:\u00a0 <\/b>Pleasure, Kevin.<\/p>\n","protected":false},"excerpt":{"rendered":"

  Damian Collins from Western Australia is a guest today as we reflect back on that market in 2016, the lessons that came from it and Damian tells us that there is some good news on the horizon.   Transcript: Kevin:\u00a0 Let\u2019s check in with…<\/p>\n","protected":false},"author":176692471,"featured_media":10351,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[32,10,11,13,36,17,27],"tags":[101],"class_list":["post-10350","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-buying-a-property-topic","category-kevin-turner-sponsored-channels","category-kevin-update","category-latest-story","category-property-investment-topic","category-property-investment","category-trends-topic","tag-podcast"],"yoast_head":"\nGreen shoots emerge in WA - Damian Collins - Realty Talk<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/channels.realty.com.au\/realtytalk\/green-shoots-emerge-in-wa-damian-collins\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Green shoots emerge in WA - 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