The month in review: South Western WA
By Herron Todd White
October, 2009
Are Bunbury’s values set to explode? With the opening
of the Forest Highway and the reduction of time taken to
travel to Perth there has been plenty of speculation on
how the property market in the South West will react.
There are certainly a number of positive factors coming
to fruition in the area with the recent announcement of
the Gorgon project coupled with the Worsley expansion.
Southern Desalination Plant and the urea plant in Collie,
The opportunities for employment in the region seem
to be very positive. Population growth within the region
also continues to be strong. These factors coupled with
the new highway, may indeed generate the momentum
to push the property market along.
Certainly the feedback from local agents suggests that
while not reaching the dizzying heights of the boom, there is definitely more interest and sales taking place
than has been happening for the past two years.
To temper this optimism there appears to have been a
return to a more measured approach to the purchase
of the property with the basic fundamentals of location,
location, location very much to the fore. Suburbs which
have traditionally been associated with lower socio
economic groups (such as Carey Park and Withers) had
seen values fall substantially from the peak and our
expectation is that these will show only very modest, if
any, growth in the short to medium term as discerning
buyers continue to be attracted to more desirable
neighbourhoods. The same can also be said for the
secondary markets associated with smaller townships
such as Brunswick.
We have recently encountered a situation (which we
hope is a one-off) involving a mortgagee in possession
of a property which only had construction completed
within the last month. The owner of the property had not
even moved in before the mortgagee took possession.
The deposit for the property appears to have been
provided by the $21,000 First Home Buyers Grant and it
would have to be questioned as to how well the finances
of the applicant were scrutinised to allow the situation to
develop. Hopefully this is not something that will develop
with any regularity as a consequence of first home buyers
being encouraged to build by the boost when they
were financially not really in a position to do so. We note
banking regulations have tightened in this area recently,
presumably to prevent this happening.
As a general comment the outlook for the area appears
to be promising with optimism outweighing pessimism
but a certain level of caution would still be appropriate in
any property purchase with informed professional advice
advisable.
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