I'm starting to understand this now.
I bought in Perth in 2008 & then again in 2009 but in hindsight the Perth market was either still at the top back then or had levelled off & prices were static. I had no growth until about 1-1.5 years ago which meant for a few years I was NG and was stuck waiting for CG to happen. I couldn't invest because of the lack of growth. Now if I had bought my first ip over Melbourne at the end of 2009 I would have done much better as it was a rising market & a fast moving market too! It's finally sinking in for me.
This time round I should not be investing in Perth as Perth already started moving quite a while back. I haven't missed out on Perths growth though as I have exposure in the market. I'm thinking Brisbane & Adelaide are rising now so I guess I can't go wrong if I follow what other ss are investing in!
I am not confident to buy myself over east. I wouldnt want to f@&$! up something so big like this. This would be a good opportunity to learn from a buyers agent I'm thinking. It could well be worth the fee charged. I need something neutral or better and want to catch the wave of a rising market for immediate CG not have to wait 3 years like last time!
You got it.
The last major boom cycle in Perth was from 2001-2006/7, property prices tripled in some cases even more because the cycle was a mother of all cycles, generally they don't last this long. Interest rates during this period were not 5% perhaps 8.5%, so if you get the timing wrong its no fun... you will be burning your money, holding costs and no growth is a killer.
In 2008 GFC the Melb market went ballistic, auction clearances were very high 85-90% and this went on for about 2 years, once again it then fell back, though in the last 12 months Melb inner city has seen considerable growth.
Back to Perth market today, yes there has been double digit growth over the last 2 years, however the market is still very strong.
I still think there are some great opportunities, I am jumping in again trying to secure another development site.
I would be buying properties in your price bracket that are very sort after as mentioned anything earmarked for rezoning. Agents can not get enough stock in Beechboro at the moment, I would look at areas 12-15 km from Perth and properties that are unique where you can add value down the track. Once zoning is ratified then you can review. If you buy low entry level with current interest rates it should not be too difficult to hold these properties.
Investing around Australia is one way to capture growth, currently I am tapping into equity gains in Sydney which is great, Syd west has actually been moving for the last 2 years, hoping that I can do the same with my Melb, QLD property over the next 6-12 months.
Cheers
MTR