Geez Ian,
I hope your just having a bad PI day. There a few posters that have IP's in Karatha, and I expect there would be some differing opinions amongst them. Ya made me want to end it all.
I agree with your comments on the RW developments though, particularly about the future gains being built into their construction price. This is a trend well underway in Broome (RW territory), where builders will quote you on a job, either new or reno/addition, and they will charge extraordinary Sqm rates. This is to be sure they get a share of the CG you will obtain from the heartache of it all. The agents in town are aware of this too and it @#$$%% everyone off.
I think the town will undergo a transformation over the next couple of years. There will certainly be more and more building activity until it reaches a point where there is little or no point in committing yourself to a large lend and a big top up. At present, most people are in a CF+ situation on houses and Villas, but flats are gonna change things somewhat. I reckon that the first thing that will happen is the camps will disappear over time indicating that there is better value in renting places for employees rather than providing that type of accom. It is a very expensive way of housing people and is usually done for short term needs anyway. This is what will take care of the occupancy rates for the flats you speak of. Families will always look for other housing options first and go for those types of properties last. Based on that you are absolutely right to poo poo the idea of buying there.
Some people have a strategy that is built around this type of IP and providing the dollar average is safe, everthing works fine overall. I have 1 of 3 properties in karatha but have resisted buying again. It does have a level of volatility and the returns have gotta be too good to last forever.
The industry there is all long term stuff that is not going to disappear out of town and this is what most PI's see as their security over time. Rents and property prices will rise and fall, it just depends where you get on the train, and where you get off. I take a lot of comfort out of the fact that my trusted Bank Manager bought there this year too. His 1m investment made my 600k look low risk by comparison.
Finally, if you let your fingers do some walking, there are other PM's in town that are negotiable on rates, or at least they were late last year. I have a 5 year Govt tenant and I make about $100 p/week after costs. 5 year fixed money and I can forget about it until 2012 and see if it was a good idea after all.
KPH posts here regularly and has a sound strategy and immense knowledge about the area. I would like to hear what he has to say about the current situation.
Cheers
Pango.
I hope your just having a bad PI day. There a few posters that have IP's in Karatha, and I expect there would be some differing opinions amongst them. Ya made me want to end it all.
I agree with your comments on the RW developments though, particularly about the future gains being built into their construction price. This is a trend well underway in Broome (RW territory), where builders will quote you on a job, either new or reno/addition, and they will charge extraordinary Sqm rates. This is to be sure they get a share of the CG you will obtain from the heartache of it all. The agents in town are aware of this too and it @#$$%% everyone off.
I think the town will undergo a transformation over the next couple of years. There will certainly be more and more building activity until it reaches a point where there is little or no point in committing yourself to a large lend and a big top up. At present, most people are in a CF+ situation on houses and Villas, but flats are gonna change things somewhat. I reckon that the first thing that will happen is the camps will disappear over time indicating that there is better value in renting places for employees rather than providing that type of accom. It is a very expensive way of housing people and is usually done for short term needs anyway. This is what will take care of the occupancy rates for the flats you speak of. Families will always look for other housing options first and go for those types of properties last. Based on that you are absolutely right to poo poo the idea of buying there.
Some people have a strategy that is built around this type of IP and providing the dollar average is safe, everthing works fine overall. I have 1 of 3 properties in karatha but have resisted buying again. It does have a level of volatility and the returns have gotta be too good to last forever.
The industry there is all long term stuff that is not going to disappear out of town and this is what most PI's see as their security over time. Rents and property prices will rise and fall, it just depends where you get on the train, and where you get off. I take a lot of comfort out of the fact that my trusted Bank Manager bought there this year too. His 1m investment made my 600k look low risk by comparison.
Finally, if you let your fingers do some walking, there are other PM's in town that are negotiable on rates, or at least they were late last year. I have a 5 year Govt tenant and I make about $100 p/week after costs. 5 year fixed money and I can forget about it until 2012 and see if it was a good idea after all.
KPH posts here regularly and has a sound strategy and immense knowledge about the area. I would like to hear what he has to say about the current situation.
Cheers
Pango.