Why is Perth attracting property buyers now?
Next to Sydney and Melbourne, Perth attracts a big percentage of international migrants – professionals and skilled talents – coming to Australia.
This is not surprising as Perth is home to some of Australia’s biggest mining companies and conglomerates that employ thousands of people.
On top of that, Perth can boast of its strategic location – proximity to Asia – making it a prime doorway for businesses coming into and expanding from Australia.
For property investors, Perth is now an attractive growth area with much potential and growth prospects to back it.
In a recent visit to Perth to evaluate several investment properties, the Wealthi Team was impressed with the vibrant atmosphere, existing and planned infrastructure and other signs of gentrification, which is a precursor for further growth.
One of the areas the Wealthi Team found promising is Lakelands, which is the northernmost suburb of the city of Mandurah in Western Australia. With travel time of around 45 minutes from the Perth CBD and its proximity to the coast, Lakelands is now attracting huge interest from a wide range of property buyers - both owner-occupiers and investment property investors.
In his analysis of the Perth property market, Wealthi co-founder Domenic Nesci said, “Perth is one of the rare markets where you can still pick up a beachside investment property for about $550,000 with about 5% rental yield.”
“Given this strong rental yield and a long-term investing horizon, a patient property investor will do well in this market.”
Like other major capital cities in Australia, Perth is experiencing a tight rental market with a rental vacancy rate of around 0.41%. Based on CoreLogic figures on the rental market across the country, the shortage of rental accommodation may persist in the coming years due to the low level of supply.
In fact, it’s been reported that there is a shortage of around 20,000 – 22,000 homes in Perth which will persist in the next few years unless there is a concerted effort to build and fast-track the release of land and construction of high-density accommodation.
In some parts of Perth for example, the rental population is dominated by owner occupiers which account for about 80%. This means only 20% is available for tenants.
Kej Kulane, senior investment specialist at Wealthi said locations with this mix of owner-occupiers and tenants are good investment areas for property buyers.
Kej also highlighted two other key factors – affordability and accessibility – that make Perth an attractive investment market for property buyers.
Recent state-by-state employment figures showed that Perth has one of the lowest unemployment levels in Australia. Coupled with relatively low-priced properties – home and land or house/apartment packages – this means people can buy and invest in properties.
“Perth is one of the most affordable markets to invest in at the moment,” Kej said.
At the same time, a massive infrastructure investment program is already in the pipeline which includes the construction of a major transport hub and redevelopment of some existing structures or building of new ones.
If you would like to know more about our current opportunities in Perth, reach out to our team: