The prospects for property markets across Western Australia in 2019 are healthier thanks to improved infrastructure in some regional centres and southern state investors moving funds into more affordable Perth real estate markets.
“We’ve seen some improvements in weekly rent prices in some Perth suburbs,” said Craig Abbott, General Manager WA, Raine & Horne.
“We expect that more Sydney investors will note improving rental yields coupled with more affordable Perth real estate prices, and consequently be a bigger factor in our market in 2019.
“The caveat is bank lending. It’s really important the banks find a way to make it easier and faster for investors to get finance over the line next year to help get real estate markets.”
Mr Abbott said 2019 will be a year of opportunity for Perth property buyers. “The buying hotspots will be found in Perth’s western suburbs such as Claremont and moving up the coast,” he said.
“There is mounting demand for properties priced between $800,000 and $1 million. Anything above $800,000 offers good value in the western suburbs and most buyers are white collar workers.”
Construction and dolphins to drive real estate in Bunbury
The City of Bunbury, the second capital city of Western Australia, will benefit from the construction of the $650 million regional bypass and Albemarle’s massive new $1 billion lithium battery processing plant that will be in the Kemerton industrial area and create hundreds of new jobs in WA’s south west.
“Hundreds of new jobs will be fantastic for our market and we’re hoping the project starts sooner rather than later,” says Alec Marra, Director, Raine & Horne Bunbury.
“We’ve seen time and again, that major infrastructure announcements can result in above average growth in median prices once the market absorbs the implications for real estate values.
“It’s estimated that once the plant is established, there will be around 500 workers required for its operation. This injection of workers will underpin sales and rental markets in Bunbury.”
Apart from the bypass and the lithium mine, there has also been a cumulative $40 million invested into the town via the redevelopment of the iconic Dolphin Discovery Centre and the development of Landcorp’s Koombana North precinct, which will both underpin the local economy, notes Mr Marra.
Investment in the foreshore and shopping centres are good news for Mandurah
The transition of the city of Mandurah in 2018 along with the lithium plant near Bunbury will support capital growth and real estate activity next year.
“The lithium plant in Kemerton is on the Mandurah side of Bunbury and we see that Mandurah will be a launching pad for many of the plant’s employees as they’ll only be 50 minutes from work and an hour from their relatives in Perth,” notes Peter Vetten, Principal of Raine & Horne Mandurah.
The City of Mandurah also spent $17 million on a makeover of the Mandurah foreshore, while $51.8 million was spent on replacing the old timber bridge with a dual carriageway crossing linking Mandurah to Halls Head, Mr Vetten says.
“We’ve also had a $350 million refurbishment of the Mandurah Forum by owner Vicinity plus a couple of our other shopping centres have received $10- $30 million upgrades.”
Mr Vetten said the improvements to government and private sector facilities is a clear indication commercial and bureaucratic interests believe retirees and sea changers have identified Mandurah as a viable and more affordable alternative to Perth. The median house price in Mandurah is $280,000 compared to $450,000 in Perth.
“Mandurah is just an hour from Perth, with excellent transport and freeway facilities, coupled with a fantastic lifestyle offering ample water-based activities,” Mr Vetten explains.
“Retirees are identifying value in waterfront and near-water properties and that Mandurah is no longer a sleepy hollow thanks to the council and commercial makeovers.
“Given this investment and the job opportunities that will flow from the lithium processing plant, 2019 looks like being a very robust year for real estate activity and values in Mandurah.”