The month in review: Perth
By Herron Todd White
Many areas of Perth have or are being affected by state projects or council led zoning changes, which we consider will lead to a flurry of new activity and result in new investment of a superior quality to existing properties and generally introduce a new demographic into the area. In this article, we have identified four areas that we consider to have a considerable amount of upside and will continue to change and develop over the coming years.
A recent zoning change affecting several suburbs in the north west sector of Perth has been long anticipated, hence we do not expect any short term value improvements. However we anticipate it will lead to gentrification of the area and generate urban renewal projects over the coming years. Given the soft market conditions being experienced at present, we don’t expect there to be a rush of development, but we would expect to see some new products (villas, townhouses etc) offered for sale in the short term as speculative developers test the waters. Of the area affected, we see the highest potential in the suburb of Craigie, where $450,000 will buy a block with triplex potential under the recent zoning change (subject to the approval of all relevant authorities). We would expect in five years time re-development will rejuvenate Craigie and bring with it a modern streetscape. As construction continues in the far northern suburbs, we consider that these inner older suburbs are highly likely to maintain and increase in value.
Gentrification is also likely to have a significant effect on the suburb of Bentley. A relatively small number of older, predominantly state owned dwellings have been demolished to make way for the construction of 1,500 new dwellings in a project led by the state government. This urban renewal project will eventually lead to the reduction in the stigma attached to the suburb, created by unsociable behaviour over a long period of time. A similar project in Queens Park effectively transformed the suburb within a period of three years and resulted in a superior quality of housing, not only in the redevelopment area, but across the suburb as a whole. We consider that Bentley will undergo a similar transformation within a period of five years.
A recent article listed the 25 suburbs within 15 kilometres of the Perth CBD where the median sale price remains under $500,000. The article highlighted many suburbs which have been on our radar for some time, in particular the three neighbouring suburbs of Langford, Lynwood and Ferndale. A recent zoning change in Langford has created a distinct increase in construction activity and a similar proposed zoning change in Ferndale is likely to have a similar effect, but to a smaller extent. The City of Canning is reviewing zonings in many such areas and will be the impetus for investment in these long overlooked areas. The area offers proximity to a range of commercial precincts and employment hubs and abuts the Canning River Regional Park. We consider that the redevelopment that has occurred in the suburbs of Wilson and Riverton will be recreated throughout these three suburbs.
The other area that we think will continue to perform strongly is the foothills suburb of Swan View. Rezoning has pushed new developments within the area which has refreshed a number of pockets with new houses, villas and group houses appearing. Neighbouring areas such as Helena Valley and Jane Brook continue to expand and the overall corridor continues to gain popularity. The area has long been overlooked due to perceived antisocial problems in times gone by, however the area is a draw card for a variety of family structures attracted to the affordability of the area, the coastal plain views on offer from part of the suburb and the proximity to the Swan Valley.