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According to Perth
based buyers’ agent Liz Sterzel, Rockingham is a beachfront buyers
market offering investors one of the few remaining opportunities to pick up
reasonably priced properties with long term potential along the West
Australian coast.
Sterzel says house price and growth in coastal suburbs
near Perth
will continue an upward spiral over the next decade and leave most
properties out of reach for ordinary buyers.
“In a few years time, you won’t see coastal
properties close to Perth
priced as they are in Rockingham today, which is why now is a prime time to
move while there’s still a good number and range of properties
available, for any investment level,” she says
“In the Rockingham area, properties range from
homes for the first time buyer, well under the Perth median price at around $300,000, up
to the top end of the market including high rise developments and
properties priced around $700,000 to $800,000.”
Sterzel says as well as a good choice of properties in
the Rockingham market, buyers have strong negotiation power at the moment.
“There are plenty of properties on the market in
Rockingham because there has recently been a lot of new land subdivisions
and developments creating new housing,” she says.
“The number of properties on the market has also
risen from recent growth – there has been a good growth spurt in
Rockingham, so a lot of investors are looking to cash in their profits.
“Rockingham has excellent long term potential and
we expect to see a double digit growth rate, and because the properties are
generally priced very well with favour tipped toward the buyer, it’s
a prime area to invest in today.”
THE AREA
Sterzel says there has been plenty of investment in
Rockingham, which now boasts new and developing infrastructure to make it
an affordable, coastal suburb with huge growth potential ahead.
“Rockingham offers residents fantastic lifestyle
benefits including pristine beaches and a cosmopolitan foreshore, and plans
are in place to redevelop the village area as well as link in to the new
rail infrastructure being developed in WA’s southern suburbs,”
she says.
“Perth is already
easily accessible by freeway and is soon to be linked even more conveniently
with the new rail line, so it will be easier for people to live in
Rockingham and work in the Perth
city.
“Employment is expected to surge in the
area’s industrial sector with business investment set to create
around 10,000 new jobs over the next 20 years.”
Sterzel says the industrial influence in the Rockingham
area has affected the area’s reputation but the new rail line would
help to break the stigma.
“Rockingham
has earned the reputation of being fairly rough around the edges, but this
stereotype is likely to break-down once the rail line is developed –
similar to the effect the Graham Farmer tunnel had in lifting the profile
of Rivervale and Belmont,” she says.
“The industrial infrastructure is also situated
very close to the beaches, but this has not appeared to affect property
prices – some prime beachfront areas bordering the industrial silos
are among the area’s most expensive new developments.
“The Rockingham foreshore is one of the few
north-facing beaches in WA, which is a significant attraction as the ocean
views can be enjoyed all day long from a north-facing home, instead of only
in the morning or afternoon as is the case with east or west facing views.
“
Sterzel says Rockingham is predominantly a family area
and consists of very active residents including many single parents, fly in
fly out workers, British emigrants and retirees.
“Rockingham has recorded the second highest
population growth in WA in the past five years and the number of households
has increased by almost 50 per cent over ten years,” she says.
“Around a third of the residents in Rockingham were
born overseas and more than half of them have come from the United Kingdom
– Rockingham is a popular destination for newcomers because of the
coastal lifestyle and its affordability.”
OPPORTUNITIES FOR INVESTORS
Sterzel says Rockingham’s appeal to emigrants, the
affordable prices and investment in infrastructure means long-term investment
potential is excellent in Rockingham.
“The best strategy for investment in Rockingham is
to buy and hold – in a few years time the supply of properties on the
coast next to great facilities will be significantly lower and drive prices
up,” she says.
“There isn’t a coastal area north of the
river within traveling distance to Perth where you can get a house for
$300,000 to $320,000 – Rockingham is just about the cheapest area on
the coast today.
“The best buys in Rockingham will have a good
location and proximity to lifestyle facilities, be on a big block, and a
well laid out home can be refurbished to attract a great tenant.
“Development in the area such as new high-rise
waterfront apartments, rail facilities, shopping centre and foreshore
upgrades as well as the establishment of a new residential hub south-east
of Rockingham, will serve as long-term growth drivers.
“The population and number of homes have increased
substantially in the past few years and this has been followed with a big
increase in the number of properties available for sale, so clever
investors can now do well by using this as leverage and negotiating hard.
“Over the past 10 years, old large blocks in the
Rockingham beach and shopping areas have been subdivided and developed
– these blocks zoned for higher density development now reach
$700,000 and higher, but opportunities are rare today.
“The construction of high-rise developments on the
beach has been rewarding for many investors, these properties sold very
quickly and the value has rubbed off onto the nearby areas and town
houses.”
ON THE MARKET
The total number of properties on the Rockingham market
in early October this year was 270 and the median house price around
$400,000.
“In the Rockingham area, you would generally expect
to pay $295,000 to $315,000 for a 3x1 home on 750 square meters and collect
a rental return of around $220 to $250 a week,” Sterzel says.
The number of properties on the Rockingham market rose by
79 per cent from 2005 to 2006.
Sterzel says investors could refine their property search
by targeting specific suburbs in the greater Rockingham area.
“Shoalwater on the West coast is mostly made up of
older homes on good sized lots with pockets of new development and
subdivision. Around 85 Shoalwater properties are currently on the market,
which is high for the area.
“The median house price is reported to be around
$470,000 in Shoalwater, but the median asking price is currently about
$530,000.
“In the last five years some luxury million dollar
properties have been cropping up around the foreshore area of central
Rockingham and there are now brand new apartments and townhouses on the
market from around $670,000 to $780,000.
“In Safety
Bay there are around
78 properties on the market and plenty of solid brick and tile, single
homes on typical 750 square metre lots at a median price of $415,000.
“The mid-priced areas in greater Rockingham are
priced around $350,000 to $395,000 and found within the Rockingham suburbs
of Warnbro, Waikiki and Port Kennedy where
there are now plenty of properties on the market.
“Further south is the relatively new suburb of Secret Harbour, which is very much
lifestyle oriented with golf courses, parks and estate-style properties
priced around $470,000.
“Cooloongup and Hillman offer some lower priced
properties, but they are not directly situated on the coast and the median
prices are $320,000 and $314,000 respectively.”
WHAT TO WATCH OUT FOR
Sterzel says delays in the construction of the new Perth to Mandurah
rail line have lead to a stall in prices, which should quickly fade once
the project is completed.
“The hold-up in completion of the new rail link to Perth has kept
property prices on hold, but this is only expected to be temporary and
values should increase sharply when the railway is operational and its
benefits start driving demand in the area.”
Sterzel says many investors could have an advantage and
pay less with expert knowledge on their side because of the discrepancy
between asking price and selling price in the current market.
“Some properties are selling below the asking
price, but generally investors will only see the asking price, so
it’s not as easy to assess the right price to pay in the Rockingham
market at the moment,” she says.
“There are
also so many properties for sale in Rockingham today, so it becomes
challenging to sort through and pick the best option – it could be an
advantage to have experts searching for you.”
PRO’S AND CON’S: ROCKINGHAM
CON’S
• Currently
there are a large number of properties on the market creating oversupply
problems, but it’s still a good time to invest considering current
prices and future investment.
• While
the railway is under construction, investors have to hold and wait until
its completion when the oversupply of properties will be used up and prices
are expected to climb.
PRO’S
• Rockingham
offers investors a chance to pick up a coastal property at an affordable
price
• Low
vacancy rates
• Generous
block sizes
• Ongoing
investment in infrastructure and development
• Excellent
opportunity to buy and hold for long term gain
• Rising
rental yields
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