The Perth Property Market Is Primed For Investors
Consistently ranked as one of Australia’s most profitable capitals, the Perth property market is showing signs of improvement for savvy investors looking to snap up a slice of the action – particularly in the Perth Northern suburbs.
The last quarter of market data (April 2019) presented some promising signs with the Perth vacancy hitting a 6-year low dropping from 7% to 2.3% amidst signs of increased leasing activity.
When speaking of the best cities in the nation to invest, REIWA president Damian Collins highlighted the effect of this statistic in this article by claiming; “This is the lowest quarterly vacancy rate we’ve seen since the March 2013 quarter, putting the Perth rental market in favour of landlords.”
It is no secret that the end of the mining boom has had a profound effect on activity within the Perth property market, however positive news is on the horizon. Investment confidence has risen by 32% from March 2017 to March 2019, listing Perth in second place in this article from Smart Property Investment which ranks the strongest capital city growth for 2019.
Whilst Perth is divided into 30 local government areas and over 350 suburbs stretching from Two Rocks in the North down to Singleton in the South, the question remains….where to invest!
Cast Your Spyglass To The Perth Northern Suburbs
We find that a majority of our clients are from within the Perth Norther suburbs, with our service area stretching from the Perth CBD and surrounding suburbs as far North as Alkimos. With this knowledge behind our team of property management specialists, it is no surprise that we are seeing more investors venturing into the Northern corridor, and the research supports this.
Areas such as Joondalup, Padbury, Craigie, Kingsley and Hillarys have been on particular interest, after recent change to the State Government’s R-Code system which enable investors to sub-divide blocks for higher profit returns.
R-codes (which stand for Residential Design Codes) help to control residential development, keeping a handle on population density in residential neighbourhoods.
The Managing Director of Gemmil Homes (Craig Gemmill) described the impact of these code changes with regards to investors in this article by explaining, “So you go from an R-20, which is one home on 500 square metres, and they increased the density to R-40, which is two homes on 500 square metres. That’s been a big driver.”
It’s a simple equation, more properties on the same block creates more opportunity for more tenants and subsequently more rental yields.
Median house prices have further risen across the Perth Northern Suburbs, with Karrinyup, Mullaloo and Heathridge enjoying recent increases, whilst the coastal Northern suburb of Scarborough enjoyed a positive median unit price growth.
Yanchep Tipped For Perth Property Market Growth
When it comes to the selecting the perfect Perth suburb for an investment property or project, Craig from Gemmil Homes recommends keeping an eye on, “…any suburb that is close to shopping centres, rail lines, transport, existing infrastructure…supporting an increase in density.” (Sourced from Smart Property Investment)
Keeping an eye on local news and future developments, the suburb of Yanchep is tipped to ignite the Perth Property Market after a $750 million roll out of infrastructure expected to be delivered over the next 3 years. Connectivity is singled out in the project which aims to introduce a $520 million rail extension alongside a $210 million freeway extension to South Yanchep, supported by a $23 million upgrade to Marmion Avenue.
Speaking with local Yanchep property specialist, Jarrod Rendell from Capricorn Beach Estate, the new update to these major transport arteries will reduce travel time to the city centre by up to 10 minutes. Tipping Yanchep to become a new “powerhouse” of the Norther corridor, Mr Rendell went on to showcase his excitement for the project.
“The massive new transport infrastructure spending around Yanchep over the next three years will give a sustained upward momentum to property values in Yanchep and cement its position as a top performer in the Perth property market.”
Mr Rendell (Source: Smart Property Investment – April 2019 Report)
A Buzzing Industrial Property Market
In this recent article by realestate.com.au has outlined a trend in commercial real estate growth, with various Perth Northern suburbs again featuring within the list of growth areas.
“There are opportunities to secure well-priced modern properties in the North, due to strong supply in the newer areas of Wangara and Gnangara,” explained Altegra leasing executive Malcolm Healey.
Thanks to government infrastructure developments like that of Yanchep, alongside various resource projects and commercial building activity, a renewed sense of demand now exists for investors looking to capitalise within the industrial Perth property market. Interestingly, demand for industrial work spaces within the freight and logistics industries have seen the highest levels of growth within this space.
Why the Perth Northern suburbs exactly? Sales and leasing expert, Sam Hammond described in this article that industrial precincts in the Norther corridor have, ”…a high proportion of smaller lots to suit the smaller businesses operating out of the area, availability of larger lots suitable to design and construct new facilities for larger tenants that desire exposure to the large residential catchment is limited.”
Looking To Invest In The Perth Northern Suburbs?
Ever since we began the agency in 2007, we have developed our love of property across a variety of Perth suburbs, with a focus of our client base being within the Perth Northern Suburbs. It’s an area where our clients (and team) live and an area we are passionate about.
Given the new changes to R-codes and zoning in the Norther Corridor, now is a great time to invest in the growth suburbs listed within this article. If you are looking to invest in the Perth property market and are considering a move North, we welcome you to contact us today for an initial discussion around your property goals.