Tom Price gets set for first residential development in 40 years

The first new residential development in 40 years will allow investors to capitalise on the annual 19% house price growth at WA mining town, Tom Price.  

The Crawford Property Group has released six off-the-plan houses with three bedrooms and two bathrooms which are being marketed to attract the town’s residential workforce.  

The $759,000 houses, at 327 Warara Street, are expected to be completed next month. Demand from investors has been strong, with the six-property first stage of the development already sold out and another six to go in the second stage.  

Crawford suggests the houses could achieve yields of up to 15% with zero vacancy rates. They are expected to lease from $2,100 to $2,200 per week and are among two new developments in the town.  

Nicheliving Constructions – winners of the 2012 MBA award for Excellence in Building Innovation – will build the highly energy and acoustically efficient houses as full turn-key packages. They will have quality fixtures and fittings, open plan kitchens, dining and lounge rooms and hidden laundries. Bedrooms will have built-in wardrobes and the main bedrooms will have en suites.  

"Tom Price is a highly lucrative market but, until now, it has been fairly inaccessible to investors," said director Ryan Crawford. "It plays an integral role in Rio Tinto’s and FMG’s iron ore operations in the area and the increasing workforce has helped the population to double to 5400 in just six years.  

"However, until 2011, there had been no new land releases or residential development for nearly 40 years."  

Pressure on housing has raised prices, and the 10 year average annual house price growth rate is 19%. In this, Tom Price’s performance has been consistent with other Pilbara towns, but a lack of new supply has restricted investor access.  

Crawford says the development takes advantage of the town’s zero vacancy rates, higher than average rental returns and strong predicted capital growth.  

"And, with both Rio and FMG ramping up production and flagging possible expansions, the projected continued workforce increase means pressure on house prices and rental accommodation is expected to remain strong."  

A Regional Development Australia report says Tom Price had a dwelling shortfall of 259 homes in 2012 and will require between 271 and 471 new homes by 2015.  Only 37 residential lots were released in 2011 and no further land releases have been announced.  

At 747 metres, Tom Price is the highest town above sea level in Western Australia. The resources boom has helped it become the most affluent non-metropolitan region in Australia, with the average Rio Tinto employee's wage being significantly higher than the Australian average.  

The median age of 29 reflects Tom Price's relatively young family-oriented community. The town is named after Thomas Moore Price, vice-president of the US based Kaiser steel company. It is the closest town to Karijini National Park and is serviced by the Paraburdoo Airport.