Where to buy investment properties in Perth

Property investors are increasingly active in Perth, but which areas will give the greatest returns?

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Blogger: Daniel McQuillan, principal partner, Investwise 

There is now growing evidence in the early months of the 2014/2015 financial year that property buyers are now more active in premium Perth suburbs along coastal and riverside areas.

The reality is that demand for prime properties in these locations are expected to surge during the coming years due to the surging population of Perth making building land in these locations scarier.

If you have newly arrived in Perth and are considering buying a coastal or riverside property, then you might consider the following questions and answers:


Do Riverside suburbs or Oceanside suburbs deliver the highest capital growth rates over the long term?
Both Riverside and Oceanside suburbs tend to the best performing suburb for capital growth in the Perth metropolitan area. In recent years, lower priced Oceanside suburbs have performed more strongly although over the longer term. Riverside suburbs generally achieve similar capital growth rates as Oceanside suburbs because of the demand for lifestyle living and the scarity of building land in these areas.

What have been the best performing Oceanside and Riverside suburbs over the last decade?
Strategically located river side and coastal suburbs which have a high level of social infrastructure i.e. located close to  schools or colleges have performed very strongly over the last 10 years. High capital growth riverside suburbs include Nedlands, Dalkeith, East Perth, Maylands, South Perth, Applecross, Bicton and East Fremantle. High capital growth coastal suburbs include Cottesloe, Swanborne, City Beach, Hillarys, North Fremantle and South Fremantle.

What are the most affordable Oceanside and Riverside suburbs?
The most affordable Oceanside suburbs tend to be located around Alkimos in the north and Rockingham to the south such as Safety Bay Port Kennedy and Warnbro and Rockingham itself. The most affordable Riverside suburbs are located East of South Perth such as Burswood, Maylands and Bayswater.

Are there any undervalued coastal or Riverside suburbs in Perth?
Riverside suburbs which have potential for strong capital growth are Bateman, Maylands and Guildford while the Oceanside suburbs of Scarborough, Ocean Reef, Quinns Rocks, Alkimos and Safety Bay have the potential for strong capital growth.

When is the best time of the year to buy a home near the ocean or river?
Winter months ( right now!) tend to be the best time of the year to buy an ocean side or riverside property because of the lifestyle factor. Demand for these type of properties tends to peak during the summer months and declines during the winter months because of the weather. With fewer buyers in the market, the winter months present the best opportunity to buy an ocean or winter property.

How important are views?
Views play a critical part in the pricing of ocean and river properties. A well location property with good views of the river or ocean will sell for significantly more than a property without views. A good tip is to try to buy an older style property with good views because the value of the land is worth significantly more than the house.

How far from the waterfront should I buy a property?
If you are buying a home near the river or ocean, you should aim to buy a home within easy walking distance to the water. People like to walk to the waterfront rather than having to drive their car. If you are considering buying a property, then physically walk the distance to the waterfront because driving in the car give a false sense of the distance.

Are there any other factors that will impact on property values?
Because you are buying a lifestyle, issues such as restaurants and cafes are becoming more significant in driving the property values of Oceanside and Riverside properties. This is why property values in East Perth and South Perth have risen sharply in recent years and why property prices near the oceanfront in Cottesloe are now very expensive. Both these areas have a range of cafes and restaurants which appeal to home buyers. However, a good tip is to buy into a new ocean suburb where these facilities currently do not exist but are planned for in the future. This means yo you will pick up capital growth when these infrastructure is built.

Are weather conditions important in buying an Ocean or Riverside property?
The position of a home can play a key role in the long term value of the property. For example, ocean side properties that are less exposed to the wind such as Shoalwater tend to achieve a higher selling price than neighbouring ocean side properties. Wind factors and the exposure of the property to the sun can also influence the selling price of riverside properties.

Should I buy a property through auction?
Many Oceanside and Riverside properties are sold through auction. If you are considering buying a home through an auction, make sure you do your research and stick to the price you believe the property is worth. A reliable local real estate not connected to the auction could assist you in determining the value of the property.

About Daniel McQuillan

Daniel McQuillan has held senior positions in the property and financial services sector for over a decade. During that time he has gained professional qualifications and a wealth of experience that has enabled him to personally build a very successful property portfolio based on a targeted plan. In 2011, he established Investwise so he could utilise these skills to help other people create wealth through similarly devising a personal investment model that best suited their personal circumstances. As a result of this targeted and personal approach to property investment, Investwise is now one of the fastest growing property investment advisory services in Western Australia.

Further information can be found at www.investwise.net.au

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