First Investment Property, WA

[Tommytomato]

Hello all and thank you for your time.

I am currently looking for my first investment property. I have found Bayswater as a place of intrest, I am planning on buying a unit, and holding for years to come for income later down the track. (Aiming on buying more than one over time of course!). Bayswater I have found very low vacancy rates, low prices of units (around 210-230k) with strong enough rent returns of $300. Can anybody help me woth this area, or is this not a good place to start? Thank you anybody for a little help

 

[INVSTOR]

I think Bayswater is quite good. How many are in the complex at that price?

 

[benprop]

I am looking in Albany for my next IP.... Do you know anything about that suburb? I know Terry Ryder has done a hotspotting report on it. 1 bedroom unit for $270K

My investment advisor and financial planner believes i should diversify into WA as i have my first 2 IPs in QLD.

Need to do my DD on it as i don't have any idea of the market over there.

Cheers

 

[Tommytomato]

Thank you for your reply
That's the catch I guess, there are a lot, I think 90.
Is this a problem? Or still worth a look? I have recently moved to WA, so do not know the areas very well just yet. Seems close to transport, close to airport, 8km from CBD.

 

[sanj]

I am looking in Albany for my next IP.... Do you know anything about that suburb? I know Terry Ryder has done a hotspotting report on it. 1 bedroom unit for $270K

My investment advisor and financial planner believes i should diversify into WA as i have my first 2 IPs in QLD.

Need to do my DD on it as i don't have any idea of the market over there.

Cheers

Albany is a regional town, not a suburb. I have absolutely no idea why someone would recommend buying in Albany but i freely admit i dont know much about it.

 

[Aaron_C]

Thank you for your reply
That's the catch I guess, there are a lot, I think 90.

The main issue with buying high rises like that is that one bad sale in the complex can really **** up the value of your own apartment since there is nothing to differentiate your apartment from the other. Whereas with other types of property they are considered more 'unique' and therefore this sort of thing is less likely to happen.

 

[Brady]

The main issue with buying high rises like that is that one bad sale in the complex can really **** up the value of your own apartment since there is nothing to differentiate your apartment from the other. Whereas with other types of property they are considered more 'unique' and therefore this sort of thing is less likely to happen.

Not only can it be sometimes hard on sales/valuations when you have a cheap sale in the complex ruining the vals, can be tough on rents if there are low demad due to several options in the complex.

 

[westminster]

Thank you for your reply
That's the catch I guess, there are a lot, I think 90.
Is this a problem? Or still worth a look? I have recently moved to WA, so do not know the areas very well just yet. Seems close to transport, close to airport, 8km from CBD.

Bayswater is pretty good but I would steer clear of any apartment building with a lot of units. Generally they have more ammenities such as lifts, pools, gyms, communal areas which all increase strata fees etc.

The rule of thumb with apartments is to stick to smaller buildings 2-3 storeys high with less mod cons but good location.

Anywhere within 5 or so kilometres from the city in a smaller complex would be good I think.

 

[westminster]

And if it's 81 King William Street then there are about 8 for sale at the moment - I would steer clear of a place that has that many for sale at one time.

 

[Tommytomato]

I see, so all bad in complex with lots of units?

 

[HotRod]

And if it's 81 King William Street then there are about 8 for sale at the moment - I would steer clear of a place that has that many for sale at one time.

Also, a very rough end of town.

Take a walk through there and you'll soon be running.

 

[f.f]

I am looking in Albany for my next IP.... Do you know anything about that suburb? I know Terry Ryder has done a hotspotting report on it. 1 bedroom unit for $270K

My investment advisor and financial planner believes i should diversify into WA as i have my first 2 IPs in QLD.

Need to do my DD on it as i don't have any idea of the market over there.

Cheers

Living in Albany I may be in a position to provide some useful information for you.

At the moment there is plenty of activity at the lower end of the market. The lower end being defined by anything in the 300's. The further you get from the 300's the slower the market has been with only 4 properties selling for $1m+ last year.

I did read Terry's hotspotting report in which he identified Albany. Credibility took a dive after reading that report.

If I remember correctly a large proportion of his buy recommendation revolved around Southdown Nickel (future now questionable), FIFO flights out of Albany and heading north to mineral operations, new hospital being built (a 'short term' employment boost) and expansion to the port (closely related to Southdown). Not a lot when you really look at it.

I distinctly remember listening to a Radio National news bulletin, admittedly many years ago, which identified Albany as one of only two places in Australia which made a net negative contribution to the national economy. In otherwords - more social security (AKA aged pensions) came into the town than income tax was collected.

While Albany is a country city (~35,000) it is dominated by retirees and many businesses were struggling last year - I have received recent anecdotal reports which suggest things have turned the corner for some of the smaller businesses in the city.

The flip side of this comment is that Woolworths have recently opened their third store in Albany and major retailing brands are starting to pop up around the place. Trying to link the two observations together I would suggest the major retailers are sucking a lot of money off the 'corner store' people.

At the moment there is no major employer in the city and you could not point a finger at any one body and say 'that' is the major employer/industry in the city. If I had to identify one - it would be 'small business' despite the fact they seem to do it tough.

While Albany is a lovely place to live I would not have any other property here other than my own home.

Hell, we don't even do tourism well. And we have plenty of stuff to show off.

If you want WA go safe and stay in Perth.

 

[westminster]

I see, so all bad in complex with lots of units?

At the end of the day it's about the sums - sometimes really good yields can outweigh the risks of little capital growth but it does depend on what your plan of attack is.

If you are looking for cash flow then your plan may be different to a capital growth plan. Ideally you get both

Do you have a budget in mind? What is your main priority?

 

[Tommytomato]

Thank you WM, the purpose is for cash flow, with hope of capital growth as a bonus. Budget is 400k and below, but was thinking as first property may just want to get a cheapie with good rents?

 

[Rolf Latham]

Also, a very rough end of town.

Take a walk through there and you'll soon be running.

pffffffffffffft

that aint a knife....... THIS is a knife : )

ta
rolf

 

[Jake D]

I see you've played "knifey-spooney" before.

 

[westminster]

I think if you're happy to go dodgy then I'd do it closer to the city

The thing to look out with the older buildings is concrete cancer. There is a cheap building in Maylands (forgotten the address) that has very cheap units but will be a pain in the long run.

I'd look at Fremantle, Highgate, Perth, East Perth, Dianella.

Or a little older refurbed villa in some of the gentrified suburbs - Balga, Medina, Midland etc

eg

http://www.realestate.com.au/property-house-wa-balga-113321615

 

[sanj]

i think if you're happy to go dodgy then i'd do it closer to the city

the thing to look out with the older buildings is concrete cancer. There is a cheap building in maylands (forgotten the address) that has very cheap units but will be a pain in the long run.

i'd look at fremantle, highgate, perth, east perth, dianella.

Or a little older refurbed villa in some of the gentrified suburbs - balga, medina, midland etc

eg

http://www.realestate.com.au/property-house-wa-balga-113321615

Sherwood court. Avoid.

 

[benprop]

Thanks F.F.

The search continues!

 

[cnotoham]

Living in Albany I may be in a position to provide some useful information for you.

At the moment there is plenty of activity at the lower end of the market. The lower end being defined by anything in the 300's. The further you get from the 300's the slower the market has been with only 4 properties selling for $1m+ last year.

I did read Terry's hotspotting report in which he identified Albany. Credibility took a dive after reading that report.

If I remember correctly a large proportion of his buy recommendation revolved around Southdown Nickel (future now questionable), FIFO flights out of Albany and heading north to mineral operations, new hospital being built (a 'short term' employment boost) and expansion to the port (closely related to Southdown). Not a lot when you really look at it.

I distinctly remember listening to a Radio National news bulletin, admittedly many years ago, which identified Albany as one of only two places in Australia which made a net negative contribution to the national economy. In otherwords - more social security (AKA aged pensions) came into the town than income tax was collected.

While Albany is a country city (~35,000) it is dominated by retirees and many businesses were struggling last year - I have received recent anecdotal reports which suggest things have turned the corner for some of the smaller businesses in the city.

The flip side of this comment is that Woolworths have recently opened their third store in Albany and major retailing brands are starting to pop up around the place. Trying to link the two observations together I would suggest the major retailers are sucking a lot of money off the 'corner store' people.

At the moment there is no major employer in the city and you could not point a finger at any one body and say 'that' is the major employer/industry in the city. If I had to identify one - it would be 'small business' despite the fact they seem to do it tough.

While Albany is a lovely place to live I would not have any other property here other than my own home.

Hell, we don't even do tourism well. And we have plenty of stuff to show off.

If you want WA go safe and stay in Perth.

Hi f.f,
What about Rockingham WA? Any thoughts on this suburb?