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January 30, 2013 | Media Release
The roll out of the national broadband network (NBN) will have minimal effect on the residential property market in Perth, but may have some impact on regional areas and commercial property, according to a Perth buyer’s agency.
“Given that internet connections are generally very good in Perth, it would be hard to imagine investors and tenants basing their residential property decisions on availability of the national broadband network,” said Property Wizards Buyer’s Agency’s Liz Sterzel.
“Tenants driven by availability of faster internet speeds would likely be just a small segment of the market who are involved in IT and internet activities, meaning the network is unlikely to have a dramatic impact on the widespread property sector.
“Just as the upgrade from ADSL1 to ADSL2, which is significantly quicker, did not affect most people – many didn’t even know the difference – the NBN rollout is likely to be similar.
“Even still, with the extra cost for switching to NBN being in the range of $10 a month for a typical family, there will probably be a good take-up but at the moment most people seem to know little about the rollout, costs or benefits.”
Ms Sterzel said while it wouldn’t work across the board, property owners could make the most of advertising the NBN status of their home.
“It may be a strategy for an investor to market their rental on the basis of the fast broadband connection, but it would be a big drawcard only for a very small niche market,” she said.
“Property managers advise that, here in Perth, most tenants are more concerned about rising energy costs and actually getting a rental.”
Ms Sterzel said regional areas with poor internet speeds or no connections might benefit from increased interest in their regions.
“People wanting a lifestyle change may be holding off moving to some regional areas because of the lack of connectivity so the NBN may well make some towns more attractive for residents and maybe retirees,” she said.
“From a property perspective though, buying homes in smaller towns is fraught with dangers so the availability of the network is not a good reason on its own to invest in an area – it would have to meet all the other criteria of a good investment.”
The NBN may have some effect on the commercial property market in Perth said Ms Sterzel.
“For many businesses – especially those in IT and companies that rely very heavily on the internet to conduct their affairs – the faster broadband will make a significant difference,” she said.
“It is likely, therefore, that commercial properties with NBN availability will rise in value but just how much it will impact prices and rents remains to be tested – NBN will be just one of a long list of features including parking, transport access and location, that contributes to pricing.”
Many parts of the Perth metropolitan area are scheduled to come on stream within four years. Some areas have no date announced yet, but the plan is to cover all areas by the target date of 2021.
For example, Ballajura, Cottesloe and Bicton have no plan announced yet, while Subiaco, Manning and Willetton have construction scheduled within a year from January 2013.