Whyalla

[Whishy]

Thoughts from the guru's in the know please

Whyalla!
- Cheap housing available.
- There is a lot of talk of construction looming, with the Olympic Dam
- There is a lot of talk of 20 trillion dollars worth of oil in the area
- There is talk of an Army Barracks expanding by 600%
- There is talk of expanding ports
- I have priced housing from low 100k to mid 200k to which are receiving 7% yields in Rental Returns.

Does anyone have any information or viewpoints for this area?

I am looking to purchase 1 to 2 properties.

 

[underdev]

I know people who have done very well out of Whyalla, it can be a bit cyclic and things were not looking too good a few years ago!

One steel (Now Arrium) runs small margins, there was talk of closing down about 2 years ago - that seems to have passed

Arafura Resources has canned their 1b minerals processing plant

BHP will they won’t they - Who knows, my guess is it would be some time

There has been allot of hype in API and other spruikers, the developers have moved in...

If you can find a duplex with + cash flow or a block of units it could be ok. I wouldn't buy for immediate capital gains

 

[Whishy]

Thank you for your comments.

I suppose the attractive part of investing there is the low up front expense for a good yield.

I'm new to investing and I'm failin to see the 'risk' of losing, I can only see a 'risk' of no potential gains.

Am I in the ballpark here?

 

[Bullfrog]

We bought a maisonette at the beginning of the yr. Opted for a 3 brm. Purchase price plus cost plus minor reno $140K. Rents out at $250/wk. No brainer really. Rents have dropped back a bit since then but unit still pays for itself. We bought in Whyalla Norrie as we believed it showed the best value for money. I'll let you do your own research into area's. Easy really just ask rental managers and they'll give you a clear picture. Future growth looks promising although short term growth looks low at this stage

Cheers Bullfrog

 

[Waldo]

- There is a lot of talk of construction looming, with the Olympic Dam
- There is a lot of talk of 20 trillion dollars worth of oil in the area

That is the first I've heard of construction looming with Olympic Dam! Any expansion is years & years away and likely to be a lot less capital intensive than the 30 billion number they used to throw around. I find a good indication of activity at Olympic Dam is looking at the vacancy rate for Roxby Downs. Having said that I do believe the expansion will happen eventually.

I'm not convinced that Whyalla will be a in a particularly good location for the oil found in the region - my understanding is that it is all far north. Port Augusta is more likely to benefit from that as it is on the way to the north & the region hub(while Whyalla is a 1 hour side trip).

Having said that I would consider investing in Whyalla - initial outlay is low, yields are reasonable.

 

[DaveM]

Park Trent are advertising house and land investments in Whyalla constantly on the radio currently. Investment houses starting from $300k! Bargain!

 

[strongy1986]

That is the first I've heard of construction looming with Olympic Dam! Any expansion is years & years away and likely to be a lot less capital intensive than the 30 billion number they used to throw around. I find a good indication of activity at Olympic Dam is looking at the vacancy rate for Roxby Downs. Having said that I do believe the expansion will happen eventually.

I'm not convinced that Whyalla will be a in a particularly good location for the oil found in the region - my understanding is that it is all far north. Port Augusta is more likely to benefit from that as it is on the way to the north & the region hub(while Whyalla is a 1 hour side trip).

Having said that I would consider investing in Whyalla - initial outlay is low, yields are reasonable.

Waldo, port Augusta won't benefit from any 'oil' in the Arkaringa basin, nor will Whyalla
It's shale gas up there and as far there has been next to no drilling. The Arkaringa basin is unexplored and unproven and it willl be at least 5 - 10 years until any meaningful exploration is done

Also port Augusta is a shallow port and cannot take cape size vessels

Port bonython near whyalla is deep water and it will be expanded

This to me is the green light for SA mining

 

[JT7]

Park Trent are advertising house and land investments in Whyalla constantly on the radio currently. Investment houses starting from $300k! Bargain!

Said with tongue firmly in cheek lol

 

[strongy1986]

Developers are ruining the property investment potential in towns like Whyalla

The funny thing is that as an investor you would probably think it is less risky to invest in these larger regionals than a smaller town but it appears to be the opposite. These towns provide the developers with the resources they need to built there product Economically where as small towns do not.

I think whyalla will do well long term as long as the local council have a look at Gladstone as a case study.
It's all very well keeping housing affordable by building new estates but what happens when the mining stops? A crash to levels below pre mining prices? Too much supply and not enough demand

 

[lizzie]

Gosh - I lived in Whyalla 6 years ago and it sounds like absolutely nothing has changed.

Onesteel (now Arrium) limping along - going to close - not going to close - Olympic Dam going to boom - not going to boom - Port Bonython going ahead - cuttlefish breeding ground so not going ahead - going ahead - not going ahead - the prostitutes fly in on payday - the locals fly/drive out on Friday.

Personally I liked Port Lincoln.

 

[underdev]

Gosh -
Personally I liked Port Lincoln.

I have Lived in Port Lincoln much the same as Whyalla - Wanna, Gonna but it never happens. There is talk of mining taking off on the Eyre peninsular If the port is dredged - The fisherman hold power and don't want this to happen. IMO Port Lincoln is a much nicer place to live than Whyalla.

I worked in Whyalla - My experience was that brain matter is severely lacking. Trying to get semi reliable workers was difficult for the company I worked for (not mining related). The baby bonus created a mini population boom as every teenage girl wanted to cash in on this marvellous government scheme!

 

[Corey Batt]

Wouldn't touch it with a 10 foot barge poll to be honest.

Wife works in a multinational which is related to a lot of the projects mentioned here, people going to the wall left-right and center. Projects stalling significantly which doesn't give me much attraction to the area just from that anecdotal evidence.

 

[Whishy]

Wouldn't touch it with a 10 foot barge poll to be honest.

Wife works in a multinational which is related to a lot of the projects mentioned here, people going to the wall left-right and center. Projects stalling significantly which doesn't give me much attraction to the area just from that anecdotal evidence.

Thanks CJay.

You dont believe that once the first major contract is awarded, it will set a precedence of whats to come?

However, there is no real crystal ball is there..

Will keep looking.

 

[strongy1986]

What I will say is do your own research

Whilst people may can Whyalla, the incomes there are higher than most of Adelaides suburbs (census data)
It's SA's most prospective regional
Port bonython is now actually going through the planning process (sa gov website) instead of jus being talked about

A quick look on seek will show plenty of new jobs in town including OneSteel, Worley Parsons and BCG, not to mention the hospital

Whyalla has a focus on residential roles with fewer fly in fly out roles

It's not all doom and gloom

 

[Murphy69]

Thoughts from the guru's in the know please

Whyalla!
- There is talk of an Army Barracks expanding by 600%

Not an Army Barracks, but an Army Range. Barracks will bring soldier, families, support services and heaps of construction, but a range expansion won't bring much extra.

Expansion of range will bring a small amount of construction and maybe a couple of extra range caretakers. There might be an increase in exercises, but you won't see a huge expenditure increase in the region.

But the Cultana range is closer to Port Augusta anyway, so thats where the effect would most likely be felt.

Disclaimer: I own an ex-govvie in Whyalla, and view it as a cheap low risk 'punt'. Its CF neutral on a 95% LVR, and will probably be positive in a year or two, and if things do take off, then great. If not, I'll just let it sit and do its things for a few more years and see what happens.

Murphy

 

[jim1964]

Wouldn't touch it with a 10 foot barge poll to be honest..

As posted before,i wouldn't invest in Whyalla either chasing the miners.If you asked me what about Port Lincoln,this would be the better bet.I am actually looking at a small block of units there now.

 

[Logica]

What I will say is do your own research...It's not all doom and gloom

On balance, would agree with strongy1986. Whyalla is the most industrialised, developed town up north and the largest regional city in SA. Eventually, some of these mining etc project will happen and once they do, focus will be on Whyalla. If one could structure an IP investment similar to what Murphy69 did (CF neutral, well located, functional, appealing to a widest possible target market) then the downside risk is low whilst the upside potential is high. I wouldn't write it off, particularly as an addition to an established IP portfolio.

 

[asdf]

Sorry to bring this old thread up again, anyone have any updates or views on Whyalla and region that you care to share?

 

[strongy1986]

Sorry to bring this old thread up again, anyone have any updates or views on Whyalla and region that you care to share?

It's been over supplied by developers. Not dire like Gladstone but has definitely hurt yields. Prices are ok

I think there is money to be made in subdividing

Arrium is doing pretty well. Finished there port expansion and about to reopen Iron Knob

Few bargains to be had there at the minute

 

[Spanish1]

Employment in town has been suffering a bit since the slow down of the mining industry. Had a typical 4 bedroom, 2 bathroom double garage place up for sale in OceanEyre since April, a few open inspections and no bites...a lot of similar houses on the market. Just listed another place today which can be subdivided, fingers crossed I get some interest.