The Perth property market has been making headlines with phenomenal growth over the last few years. So I’m giving you this WARNING! Don’t buy in Perth! The Worst Areas! From capital growth to strong rental demand, many investors have rushed to capitalise on the boom. But what many fail to discuss is the potential downside of investing in Perth. This article breaks down the worst areas to buy in Perth and why they could become a risky investment in the near future.
WARNING! Don’t buy in Perth! The Worst Areas!
The Western Australian economy is heavily reliant on the mining industry. In fact, over 60% of the state’s GDP comes from mining. This dependency makes Perth’s property market extremely vulnerable to fluctuations in mining. WARNING! Don’t buy in Perth! The Worst Areas! While mining has been booming, leading to rapid growth in the housing market, any slowdown in this sector could trigger a ripple effect, potentially leaving investors in trouble.
In this article, we’ll explore three areas in Perth where the risks of oversupply and price drops are becoming more evident. If you’re thinking of buying property in Perth, WARNING! Don’t buy in Perth! The worst areas may not be what you’re expecting.
Area 1: Perth’s North East
This has been one of the best-performing markets in recent years. Property prices have surged due to an influx of interstate investors, with many locals unable to afford homes in the area anymore. However, there are signs of trouble ahead:
• Supply is growing: While the current inventory is low, building approvals have spiked. More than 2,000 new homes are set to be built soon.
• Rental market is tight, but…: Vacancy rates are currently at 1.25%, indicating a tight rental market. However, once those new homes are completed, vacancies will rise, and rental demand may soften.
• Interstate investor interest: Much of the new housing stock is aimed at investors, meaning these homes will be available for rent, potentially leading to an oversupply of rental properties.
Area 2: Perth’s North Outer Region
Wanneroo is Located further north of Swan, tells a similar story. Interstate investors have driven up prices, but the market could be heading for a downturn.
• Rapid price growth: House prices in Wanneroo have doubled in just a few years, with some properties now costing over $800,000.
• Low inventory: There are very few houses for sale at the moment, but demand is starting to taper off.
• Building approvals on the rise: Wanneroo has over 2,000 building approvals in the pipeline, which could lead to an oversupply of housing. This means we might see prices flatten or even fall.
Area 3: The Worst of the Worst
Rockingham has been one of Perth’s highest-performing suburbs in recent years, with property prices soaring. However, it’s now at risk of experiencing the biggest decline.
• Price surge: In just 18 months, house prices in Rockingham have jumped from $450,000 to over $800,000.
• Vacancy rates are rising: The vacancy rate in Rockingham is now at 2.6%, a sign that rental demand is weakening.
• New builds: There are 1,400 building approvals, meaning a significant amount of new housing will soon hit the market. With more rental stock available, investors may struggle to find tenants, leading to rent reductions and, in some cases, incentives like free rent for new tenants.
Ex miner makes $900,000 from property by getting 2 FREE blocks of land <– CLICK HERE FOR NEW VIDEO
In conclusion, WARNING! Don’t buy in Perth! The worst areas may seem tempting due to past performance, but the signs of an impending downturn are becoming too hard to ignore. Be cautious, do your research, and consider alternative markets if you want to avoid potential losses.
If you’re looking to invest in Australian property, make sure you analyse each suburb’s data carefully before making a decision. A little research now can save you a lot of money down the road.