The West Australian Property Report Interview
Posted 28 . 11 . 18
The West Australian’s Senior Journalist Chris Thurmott recently interviewed Stirling Capital’s Director of Sales and Marketing for their September 2018 Property Report. Read the full interview here.
Q) What are your thoughts on the property market in Perth at the moment?
A) In a word – Opportunity! There are some great opportunities for apartment buyers right now. Developers are providing an exceptional value proposition to buyers with competition creating better quality apartments, and many offering features that were previously considered upgrades, as standard specifications. The current market provides buyers their best chance in years at purchasing a superior standard of property in a better location at a lower price.
Contrary to the common belief that there is an oversupply of apartments in Perth, most of what is currently under construction or previously built has actually been sold and mostly to local owner occupiers. Given the current low rate of building approvals, it is likely that we will see another shortfall in apartment supply within 12 months.
Q) What has 2018 been like for the industry in general?
A) 2018 has been challenging on several fronts. The industry has been hindered by several issues such as the finance sector’s tougher lending criteria, speculation about the impact of the banking royal commission, increases in foreign investment tax and APRA’s imposed caps on investor loans and limits on interest only lending.
These issues have impacted both the industry and buyers, with the ability to secure funding becoming increasingly difficult for many developers and prospective buyers.
Despite this, stronger developers have managed to continue to deliver quality product to market and a surge of savvy buyers have seized this period as an outstanding buying opportunity. We expect 2019 should see the market stabilise and see some growth towards the latter half.
Q) What are some of the benefits of apartment living compared with buying/building a house?
A) Firstly location! Most buyers could never consider buying or building a conventional home in the same area as they may be able to afford an apartment meaning they can afford to live in a more affluent or desirable location generally closer to their work and better amenity than some of the sprawling suburbs where the level of amenity is not as high. To give you an example, you cannot buy or build a house in a central Perth location for $400,000 – $600,000, yet you can buy an excellent quality, brand new apartment in the city for that price.
Second is quality! The quality of specification in an apartment will be far superior to a house due to the size and cost efficiency in building many e.g. higher ceilings, floor to ceiling tiling in wet areas, timber or stone flooring, quality kitchens with European appliances etc.
Thirdly is lifestyle – more time, convenience and amenity. Apartments offer residents improved safety, security, access to local facilities, a higher level of amenity, a strong sense of community and often have a fantastic level of amenity from communal BBQ area’s in most buildings to resort style facilities in the larger developments.
Many new apartments offer impressive design features, better affordability, and a lower maintenance, easier lock and leave lifestyle – leaving residents with more time to enjoy life with family and friends.
Q) Which areas of suburbs do you think will be the ones to watch in terms of apartments in 2019?
A) The coastal areas are the ones to watch, particularly growing areas earmarked for further development such as Port Coogee and Scarborough, which offer great value and an incredible lifestyle. Nowhere else in Australia can you buy an apartment in a prime, beachside village location for under $500,000.
Other areas to watch are those city fringe locations undergoing significant urban renewal and reactivation, such as Northbridge, North Perth and the inner-western suburbs of Jolimont, Wembley and Subiaco.
Q) What are your thoughts about the property market in general for 2019?
A) Overall, I expect we will see the market stabilise and return to growth in 2019 as savvy buyers and investors take the opportunity to buy property while the market offers great value. With a number of apartment developments nearing completion in early 2019, Perth can expect to see an absorption of stock and a return to normal sales rates. Pressure on rental values will also create market growth.
Q) Any further comments you would like to make about apartment living and the apartment market in WA?
A) Developers are taking their offering to the next level by creating places and communities where people want to live and building more future proof sustainable and efficient developments. As a result of a challenging market and increased competition, some developers have been successful because they have met the market by creating a better product for a better price.
At Stirling for example, we have responded to what is largely an owner-occupier market by delivering better products and more value. We have added value by designing more efficient buildings, adapting apartment designs and upgrading common areas and features in our buildings to suit discerning buyer demand.
Compared with the Eastern States, Perth is emerging as a sophisticated, high quality, sustainable and mature apartment market. Properties in Perth offer residents a better lifestyle in great locations and most importantly, far greater value for money than Sydney or Melbourne.