What a lazy $700,000 can buy in Perth: HTW
The COVID-19 pandemic has affected the Perth residential market, however house prices and rents remained relatively steady throughout the March quarter, according to the latest Herron Todd White (HTW) residential report.
The valuation firm took a look at how a budget of $700,000 could be invested in property markets across the nation.
The Perth residential median house price fell by 0.6 per cent to $475,000 at the end of May according to the Real Estate Institute of Western Australia (REIWA).
2,153 sales were recorded over the month of May, a 41.3% increase compared to April which can be attributed to the easing of restrictions throughout the state in response to reduced COVID-19 cases.
There were 593 transactions recorded over the first week of June which was six per cent lower compared to the final week of May.
Vacant land transactions fell 35 per cent over the recorded period as anticipation built about a pending stimulus package.
There were 11,319 properties listed for sale at the end of 7 June which was in line with the previous week, but is three per cent lower than a month ago and 30 per cent lower than this time last year.
REIWA data has revealed that Perth’s rental stock decreased by 17 per cent in May to 4,676, the lowest recorded monthly figure since November 2013.
It was also a 38 per cent decrease compared to the same time last year. The Median Rent recorded during May was $350 per week, which was the same as April.
REIWA president Damian Collins expects that the Median Rent is likely to remain stable until the end of the year as the Residential Tenancies (COVID-19 response) Act 2020 only allows new rentals to charge increased rents.
For the eleventh quarter in a row, Western Australia has been announced as Australia’s most affordable state to live in according to the latest Real Estate Institute of Australia’s Housing Affordability report.
The Housing Affordability Report showed that on average the proportion of family income paid on rent in Western Australia was only 16.6 per cent in March, compared to other states which reached up to 30.5 per cent.
For Western Australian homeowners, the proportion of family income required to meet home loan repayments was recorded at 25 per cent over the March quarter, the report noted.
Although affordability improved throughout the nation, it is reported that in New South Wales, homeowners still pay an average of 42.5 per cent of their family income on home loan repayments, significantly more than Western Australia.
In south-west Western Australia, sales volumes were down significantly in April and May, however the anticipated drop in values as a result of COVID-19 did not seem to eventuate.
The report notes sales that did occur during this period appear to have held their values. Bargain hunters did show up but were left disheartened as buyers held firm.
More recently, tourists have streamed back into the region in large numbers as regional travel restrictions were lifted. This is likely to result in an upswing in demand for holiday homes in a region that has been only lightly touched by COVID-19 infections.
On the back of the state and federal government building stimulus packages, there has been a spike in demand for vacant land and in some instances, lots are selling for above their asking price as people camp out at sales offices to be first in line for a block of land.
"There appears to be renewed activity in the established market as well with agents reporting very low listing numbers in established areas and a sense of urgency is lurking under the surface," the valuation firm said.
Bull Creek is a suburb located 15.5 kilometres south of the Perth CBD. The median house price settled at $701,000 at the March 2020 quarter, a 6.2 per cent fall compared to this time last year.
The report notes suburb has a number of high quality amenities surrounding it including shopping centres and highly sought after public and private schools.
A circa 1980 fully renovated four-bedroom, two-bathroom dwelling with a double carport was sold for $720,000 in February 2020.
The property resides on a 693 square metre survey strata block with a large back yard including an external patio and a spacious outdoor area.
Willetton is located 18 kilometres south-east of the Perth CBD and consists mainly of three- and four-bedroom family homes constructed from the 1970s onwards.
The median house price recorded for the March 2020 quarter was $690,000, which grew 0.7 per cent from the same time last year.
31 Ebro Way, Willetton (pictured below) sold for $704,500 in March 2020 and was on the market for 27 days.
The property is a circa 1984 partly renovated three-bedroom, one-bathroom dwelling situated on a 684 square metre block with a double carport.
The outdoor area of the property is the centrepiece with a built in bar, café blinds, below ground pool, fire pit and cabana.
Coogee is a suburb located 29 kilometres south- west of the Perth CBD and is a highly sought after location being close to the Indian Ocean and having a variety of properties, many with spectacular ocean views.
"Coogee has however become more affordable over the past two years as the 2018 median house price for the suburb was $822,500 and the median house price in Coogee recorded in the March 2020 quarter was $730,000," the valuation firm said.
The $700,000 range represents an entry level dwelling for the suburb, for example, 4 Longreach Parade, Coogee sold for $730,000 in February after being on the market for 24 days.
The property features a circa 1989 built partly renovated four-bedroom, two-bathroom dwelling with a double garage situated on a 705 square metre block.
The house offers a large 250 square metres of living space of good quality improvements as well as gable patio to the rear and a below ground pool.
Palmyra is a suburb located 17 kilometres south- west of the Perth CBD and consists mainly of dwellings, which account for 57 per cent of total properties, and duplexes and townhouses, which account for 40 per cent of the total properties in the suburb. The suburb is located near a number of high quality amenities such as shopping centres, schools, parks and the tourist hotspot of Fremantle.
The report notes Palmyra is considered an entry level suburb into the sought after Melville locality.
The median house price of Palmyra recorded in the March quarter was $625,000, which was the same amount recorded this time last year.
69A Elvira Street, Palmyra (pictured below) is a good example of what $690,000 could offer for a quality product in the suburb.
The property sold for $690,000 in March and was only on the market for 30 days.
The property features a fully renovated 1955 street front survey strata three-bedroom, two- bathroom dwelling with a double carport situated on a 435 square metre block.
The property offers 144 square metres of living and the strengths of this house are the stylish kitchen, bathroom and entertaining area.
Although this property is small, it has been refurbished to a high standard and could easily be located in another suburb close by and not look out of place.
Como is an established suburb located just eight kilometres south of Perth and is comprised of houses dating back to the 1950’s, along with a large number of duplexes and villas, which contribute over half of the properties within the suburb.
The median house price recorded in the March quarter was $875,000, a 5.9 per cent decrease compared to the same period last year.
The best option for a $700,000 purchase would be to purchase a townhouse or villa, such as 107B Ryrie Avenue, Como (pictured below) which sold in March for $735,000.
It is a rear duplex unit constructed circa 1990, featuring three bedrooms, two bathrooms and a double carport situated on a 616 square metre block.
Internally the dwelling provides 159 square metres of living area and has been renovated to a high specification with an open plan living area, marble flooring, high raked ceilings and updated bathroom and kitchen.
Externally the property has a spacious entertaining area with timber flooring, built in cabinetry and below ground pool.
Burswood is a suburb located six kilometres south- east of the Perth CBD comprised predominantly of units and apartments.
The median unit price in Burswood is $615,000, which has fallen 9.1 per cent compared to the previous year, reflecting the challenges experienced in the apartment market in some locations, the report noted.
Crown Perth is located within the suburb with an array of bars, hotels, convention centres and casino, along with Perth’s Optus Stadium.
Two-bedroom, two-bathroom apartments a few years ago were priced at over $800,000, however in the current market, the starting price point is much lower and offers the best value for a $700,000 budget.
For example, 1/23-27 Bow River Crescent, Burswood (pictured below) sold for $750,000 in February.
The unit is situated within a circa 2008 built complex and is a two-bedroom, two-bathroom first floor apartment of 120 square metres of living.
The apartment has distant city views as well as views of the Crown Casino and the peaceful river situated behind the complex.
Down in Mandurah, most options around the $700,000 mark include apartments and units along the canals.
"You can purchase three-bedroom, two-bathroom, waterfront apartments built between 2005 and 2010 for between $600,000 and $800,000.
"This will get you between 160 and 210 square metres of living area," the valuation firm said.
Just seven kilometres south-east of the Mandurah town centre is South Yunderup.
The median house price settled at $492,500 for the March quarter, falling 6.2 per cent over the year.
South Yunderup consists mostly of waterfront canal properties along the Murray River built from the early 1990’s onward.
Further south-east there has recently been more development along Forrest Highway at Austin Lakes Estate, though there are no canal views on offer here.
92 Moyup Way, South Yunderup sold for $710,000 in June 2019 after just one day on the market.
The 650 square metre allotment is improved with a circa 2008, three-bedroom, two-bathroom dwelling.
The property boasts private access to the canal with a timber jetty and a timber decked alfresco area.
In the Perth Hills, Roleystone presents a few options around the $700,000 price point.
Situated 27 kilometres south-east of the CBD, Roleystone’s median house price settled at $524,500 for the March quarter, reflecting an increase of 0.4 per cent over the year and proving that semi-rural, lifestyle properties are still being sought after by a number of purchasers. The majority of properties in Roleystone are circa 2,000 square metre allotments, however there are numerous lots that range from one hectare up to four hectares.
35 Rubida Rise, Roleystone sold for $678,000 in January 2020 after just seven days on the market.
The 2,576 square metre allotment is improved with a circa 2001, four-bedroom, two-bathroom home with a double garage.
Ancillary improvements include a pool, gazebo and large gabled alfresco with timber decking and outdoor kitchen.
Oakford is a suburb located 28 kilometres south of the Perth CBD and is dominated by hectare allotments suitable for semi-rural lifestyle properties.
The median house price is bang-on our lazy $700,000, falling 7.9 per cent since 2019.
74 Cumming Road (pictured below) sold for $620,000 in September 2019 after 26 days on the market.
The 2.03 hectare allotment is improved with a partially updated, circa 1980 dwelling comprising four bedrooms and one bathroom.
Ancillary improvements include a powered workshop and patio.
Most of the land is bare, with pecan trees and Japanese Elms spaced throughout.
The $80,000 you would have left over from the lazy $700,000 could be used in so many ways to improve the current property. Renovating the main dwelling, adding a garage and driveway, improving the landscaping, adding equestrian or animal facilities, or why not create a go-cart track - the possibilities are endless!
Up in the Pilbara, some 1,250 kilometres north of Perth, Karratha has seen a massive rebound over the past year.
The suburbs of Baynton, Bulgarra, Millars Well, Nickol and Pegs Creek are all currently sitting within REIWA’s top 20 growth suburbs for Western Australia, boasting annual increases of between 9.3 per cent and 21.3 per cent.
Median house prices in these suburbs range from $350,000 (Bulgarra) to $500,000 (Baynton).
2 Jadura Crescent sold in September 2019 for $650,000 after 18 days on the market.
Situated in the newer suburb of Baynton, the circa 2011 brick, weatherboard, and Colorbond dwelling provides five-bedroom, two-bathroom accommodation on a 544 square metre allotment.
Ancillary improvements include a double carport, cedar-lined alfresco and swimming pool.
Heading up the coast to the Kimberley region, Broome has also seen growth over the past year.
The median house price in Broome settled at $435,000 for the March quarter, increasing 8.7 per cent year-on-year. Neighbouring Cable Beach saw its median settle at $470,000 in the March quarter, decreasing 2.6 per cent annually, but increasing 3.5 per cent over the quarter.
61 Kapang Drive, Cable Beach sold for $715,000 in March after 249 days on the market.
The circa 2006 property comprises three bedrooms and two bathrooms on a 700 square metre allotment.
Ancillary improvements include a timber decked alfresco and swimming pool.
"With a lazy $700,000 in the south-west of Western Australia, it would be hard to go past the Dunsborough region.
"You wouldn’t be purchasing beach-front property but would only be a step back from the ocean whilst being on the beach side of Caves Road and Cape Naturaliste Road," the valuation firm said.
Look for properties between Gifford Road and Cape Naturaliste Terrace and properties within close proximity of the Dunsborough CBD including Peppermint Drive, Peron Street and Chieftain Way in particular.
"You could pick up a substantial, good quality established home in one of these areas, albeit not necessarily a brand new home on a reasonable size block.
"The benefits of these properties are a lack of supply due to the geographical limitations and proximity to the ocean and CBD. Potential purchasers are likely to be upscalers and buyers after holiday homes," the valuation firm said.
Another likely option would be the Geographe Bay area north of Bussell Highway in suburbs such as Abbey, Broadwater, West Busselton, Busselton and Geographe, the report noted.
"In these areas, $700,000 is likely to buy you a more substantial home, perhaps closer to the ocean and on a large lot.
"The reasons to buy here are similar to those in Dunsborough given the limited supply of properties north of Bussell Highway and proximity to the beach," the valuation firm said.