\nOn today’s show, we check in with\u00a0Damian Collins<\/b>\u00a0about the WA property market with reports that it is a bit of a cot case.<\/p>\nRead the transcript here:<\/h4>\n
Kevin:\u00a0<\/b>\u00a0You may have heard of some of the stories coming out about the West Australian market \u2013 horror stories. I\u2019ve been talking to Dr. Andrew Wilson about what\u2019s happening around Australia, as well.
\nI want to get a bit more on-the-ground information about that, so I\u2019m talking to Damian Collins from Momentum Wealth, who has got his ear very close to the ground for us.
\nGood day, Damian. How are you doing?
\nDamian:\u00a0<\/b>\u00a0Good, Kevin. And yourself?
\nKevin:\u00a0<\/b>\u00a0Good, mate. Now tell us what is happening in the WA market. Is there any reason for concern there?
\nDamian:\u00a0<\/b>\u00a0Kevin, the market is patchy; there\u2019s no doubt that. We\u2019re finding that Perth is still traveling along okay. In terms of pricing, it\u2019s up about 4.5% last year. We\u2019re expecting this year to be relatively moderate gains, maybe up to 3%, but certainly nothing of substance.
\nHaving said that, within particular suburbs, we\u2019ve seen last year even though the market only did 4.5%, some suburbs were up 18% and some properties were up even a little bit more if they were the right properties in the right locations.
\nThere are still opportunities, but it\u2019s very much a selection market. But yes, certainly, in some of the regions, there are some significant price falls happening.
\nKevin:\u00a0<\/b>\u00a0Is this on the back of what\u2019s happening with mining?
\nDamian:\u00a0<\/b>\u00a0WA has always been a resource-based economy, Kevin, and that affects the property market. It is a bit more volatile than you\u2019ll find some of the other locations around Australia. Having said that, Perth is not nearly as volatile as some of the regional areas. As I said, we\u2019re expecting moderate growth. Even though e had a slowdown in mining last year, we\u2019re still expecting moderate growth \u2013 even at worst case, sort of flat.
\nThe regional areas, particularly in the Pilbara, have been hit very significantly by the mining downturn, and that\u2019s reflected in their pricing and the rents that we\u2019re seeing come back quite a lot.
\nKevin:\u00a0<\/b>\u00a0What\u2019s happening with the returns there?
\nDamian:\u00a0<\/b>\u00a0We\u2019re seeing, certainly in Karratha and Port Hedland, rents down in the order of 25% and even in Karratha, down towards 40%, and prices down similar sorts of levels. Look, it was always obvious. We were telling clients in 2012, \u201cDon\u2019t go there. You\u2019ve missed that boat. That has had its run.\u201d
\nWhen you were paying $1.5 million and $2500 a week rent for a three-bed, one-bath, pretty average property, it was pretty clear it was unsustainable, and once the supply came on, it was always going to happen. Unfortunately, some people just wanted to see blue sky forever and got in at the wrong time.
\nHaving said that, if you had got in eight or nine years ago when the pricing was right, you could have bought a house in 2006 in those areas for $300,000, now still worth $700,000. Those areas are really speculative. You\u2019ve got to get in at the right time. We still think there\u2019s a little bit of downside, but it\u2019s getting closer to where it\u2019s worth having a look at.
\nKevin:\u00a0<\/b>\u00a0Damian, if I were to come to you with $500,000 to spend, where do you recommend I should spend it?
\nDamian:\u00a0<\/b>\u00a0For our clients with $500,000, we\u2019re looking around in areas that are proposed re-zoning. We\u2019ve been buying quite a bit in High Wycombe and Forest Hill over the last 18 months. It\u2019s starting to get up there. We don\u2019t see it as undervalued as much as we did 18 months ago, but it has certainly had a good run.
\nThey\u2019re the sorts of things you want to be looking for in Perth. Even though we\u2019re going to have a flat year, there are still areas that will do relatively well. Study the Directions 2031 strategic plan for Perth, and you\u2019ll see the activity centers. That\u2019s where we\u2019re seeing opportunities \u2013 near train stations, around areas that are likely to be re-zoned. That\u2019s where we think the market out-performance will be in the next two years.
\nKevin:\u00a0<\/b>\u00a0Damian Collins from Momentum Wealth in WA, thank you very much for your time.
\nDamian:\u00a0<\/b>\u00a0Thanks, Kevin.
\n
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On today’s show, we check in with\u00a0Damian Collins\u00a0about the WA property market with reports that it is a bit of a cot case. Read the transcript here: Kevin:\u00a0\u00a0You may have heard of some of the stories coming out about the West Australian market \u2013…<\/p>\n","protected":false},"author":176692471,"featured_media":3044,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[10,25],"tags":[101],"class_list":["post-3770","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-kevin-turner-sponsored-channels","category-sponsored-channels","tag-podcast"],"yoast_head":"\n