WHERE THE PERTH MARKET IS AT

March 23rd, 2006

Perth continues to overwhelmingly offer the best property prospects in the nation, despite signs markets on the East Coast may be picking up, according to Property Wizards buyer's agent Trevor Dunkley.

"WA's property sector will remain stronger than the rest of the country this year as the reasons for its strength - our solid economic growth, the resources boom and good population growth - are likely to remain intact," he said.

"The median house price in Perth is on the way up, but at $325,000 is still far lower than the major cities on the East coast."

Mr Dunkley said the factors driving growth in WA meant the high demand for housing would continue to push up prices.

"What helps to insulate Perth from the falls seen in other markets around the country is the increased demand stimulated by interstate and overseas migrants - it's simply that there are more people needing a home to live in and that forces prices higher," he said.

SUPPLY

But Mr Dunkley warns the chronic housing shortage gripping the WA market will make buying more difficult throughout 2006.

"There are a very low number of quality homes on the market in the areas with the best growth potential, so that will make investing super-competitive throughout the year," he said.

"Buyers should be willing to persevere though as Perth is still the best option for property investing in the country."

INVESTMENT OPTIONS

Mr Dunkley said buy and hold investors with $300,000 or less would do best to look to Perth's southern coastal strip.

"The Kwinana area, including the suburbs of Medina, Calista and Parmelia, have been recording very good growth in recent times, and prices will continue to move up, but they are still very affordable - with some still in the mid $200,000 range," he said.

"The factors driving prices higher are that these areas are just five to six kilometres from the ocean, have job opportunities nearby and will be boosted by the construction of two new train local stations reducing travel times to Perth to less than 30 minutes, as well as new land releases and rezoning changes."

The Rockingham to Mandurah southern coastal strip, including areas such as Safety Bay, Shoalwater, Waikiki, Silver Sands and Halls Head, also offer affordable opportunities for near-coastal living.

"The construction of the Perth to Mandurah rail line and numerous development projects will help prices surge higher," said Mr Dunkley.

"Right now you can still find homes for around $300,000 a little further from the ocean, but those opportunities won't last."

The best growth prospects in these strips would come from selecting older houses on good sized blocks, as close to the ocean as possible.

Mr Dunkley said investors with a budget of around $350,000 to $450,000 would do best to set their sights on Coogee in the south, or areas such as Mullaloo and Padbury in the northern coastal strip.

"Growth is surging in Coogee thanks to plans for the Port Coogee marina, which will add a new lifestyle attraction to the beachside suburb and has been luring many buyers to the area," he said.

REIWA figures revealed growth in Coogee has been 15.6 per cent a year for the past 5 years.

"In the north, the coastal suburbs of Mullaloo and Kallaroo are still offering some great buying at more affordable prices than the suburbs just to the south such as Hillarys and Sorrento - and for those with a little less to spend, Padbury, which is a suburb back from the ocean, is a wonderful option," he said.

"Padbury has most of the drawing power of its coastal neighbour, with proximity to the ocean, city, shopping complexes and great transport access, but at significantly lower prices."

In Padbury and its coastal neighbour, Hillarys, median prices have grown at 14 per cent a year over the past five years, with Padbury's median price at 56 percent of Hillary's median.

"In Padbury and Mullaloo, look for quality buy-and-hold properties," said Mr Dunkley.

"That is, older, more affordable homes in the best parts of the suburb where the purchase price is as close as possible to the land value.

"The key is to choose properties in areas where growth is being driven by a number of factors - and be ready to act, or have a representative ready to act for you."

For more information, please contact
Mr Trevor Dunkley
Director
Property Wizards
trevor@propertywizards.com.au
Tel: (08) 9381 7450