04 Oct Q&A Wednesday: Where is the Perth property market headed?
Ben has asked us a question about the Perth market.
‘What do you think of the Perth property market at the moment?
Do you think buying an inner city apartment in any state is a bad idea at the moment? Lots of people are saying there is an oversupply but it seems like demand is still really high, they also offer a good rental return of $450 a week for an investment of about $400k – $500k.’
What do we think of the Perth property market?
We don’t really know the market that well, being based in Queensland, but we did have Dr Shane Oliver from AMP and he gave us some good insights, in summary, it wasn’t all doom and gloom, you can read it here.
On the apartment side, not every single inner city apartment is currently oversupplied compared to demand. There are pockets of areas that do have demand meeting that supply like inner-city Sydney. It comes down to supply and demand. Make sure those rentals are actually there and do your own
Make sure those rentals are actually there and do your own research if there are heaps of properties up for rent you might not always get that return. Some developers also give out incentives for two years, which makes it look like it will be better than it is. You can’t really generalise you need to look into the fundamentals of the suburb, public transport and amenities.
Check the hidden costs like rates, body corporate, sinking funds, because sometimes you’ll buy a property like that and realise that the body corporate funds are empty. Another thing is sometimes you have to pay for the strata reports but it’s so worth it because you can find out if there are extra costs involved.
Another thing is sometimes you have to pay for the strata reports but it’s so worth it because you can find out if there are extra costs involved. It’s worth spending that extra money and getting those reports so you don’t get stung.
A sinking fund – You buy into an apartment complex and that’s the kitty for fixing up the complex. If there’s a big problem they throw a hat around the apartment owners and get them to put money in and help pay for it.
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