Pilbara mining rents: the seven most expensive WA boom towns
As we look to what's ahead for 2012, Property Observer is republishing some of our most noteworthy stories of 2011.
Rents are soaring in WA mining towns in the Pilbara, with modest and often unappealing houses costing as much to lease as houses in the prestigious suburbs of Melbourne and Sydney.
John Briggs from Port Hedland Real Estate tells Property Observer the regional rental market is “very, very strong” though sales prices have come off historic highs due to the current global turmoil.
Briggs says yields are now up around the 11.5% mark, having previously been around 10%.
At the same time investors have been urged to tread cautiously when it comes to investing in mining towns, with hotspotting.com.au’s Terry Ryder warning that while they have great allure for property investors because they often provide high rental returns and rapid capital growth, mining towns can be “perilous locations for investors” as they sit at the “extreme far end of the risk spectrum”.
The NSW mining boom has also driven up rents in the Illawarra and Hunter Valley regions.
For those investors brave enough to dip their toes in, here are the weekly rental numbers in WA’s most expensive mining towns
$2,000
This is the median asking rent for a house in Port Hedland, the biggest city in the Pilbara region. Demand for housing in Port Hedland is likely to increase in the coming months following WA's environmental watchdog giving its backing to an expansion of the port’s capacity by an additional 50 million tonnes. The median sales price is just over $1 million, translating into an indicative gross rental yield of 9.5%. Realestate.com.au lists 37 properties available for rent currently in Port Hedland with weekly rents ranging from $1,000 per week to $3,200 per week.
$1,800
This is the median asking rent for a house in Baynton, a suburb of Karratha. Baynton West is a major Landcorp residential development site, with 523 lots to be built and 75% to be occupied by early 2012. Lots range in price from $165,000 to $303,500 and sizes from 381 square metres to 987 square metres. According to RP Data the median sales price in Baynton is $950,000 with an indicative gross rental yield of 9.9%.
$1,775
This is the median asking rent for a house in Nickol, a suburb of Karratha just north of Baynton. According to RP Data the median sales price in Nickol is $916,500, with an indicative gross rental yield of 10%.
$1,650
This is the median asking rent for a house in Pegs Creek, a suburb in east Karratha. According to RP Data the median sales price in Pegs Creek is $705,000, with an indicative gross rental yield of 12.2%.
$1,500
This is the weekly median asking rent for a house in Dampier, a tiny town north west of Karratha, which is now a major industrial port. It services petrochemical, salt, iron ore and natural gas export industries with mining giant Rio Tinto exporting large volumes of iron ore through the port. According to RP Data the median sales price in Dampier is $855,000 with an indicative gross rental yield of 9.1%. Recent sales include a four-bedroom house on Butler Way for $1.28 million and a three-bedroom house on Anderson Street, which sold for $1.69 million. Realestate.com.au lists just five properties available for rent in Dampier, with weekly rents ranging from $650 to $1,600.
$1,500
This is the weekly median asking rent for a house in Bulgarra, a suburb of Karratha, which is now a major industrial port. According to RP Data the median sales price in Bulgarra is $750,000 with an indicative gross rental yield of 10.4%. Realestate.com.au lists just 10 properties for sale in Bulgarra, with prices ranging from $420,000 for a one-bedroom house to $839,000 for a three-bedroom house with a swimming pool.
$1,400
This is the weekly median asking rent for a house in South Hedland, a suburb of Port Hedland with a population of about 8,000 people. According to RP Data the median sales price in South Hedland is $720,000 with an indicative gross rental yield of 10.1%. On realestate.com.au rents in South Hedland range from $1,150 per week for a three-bedroom house to $2,500 for a new four-bedroom house. Less than 25 properties are available to rent currently.
$400
The median rent for a house in the Perth metro region, according to the Real Estate Institute of WA.