Time to upgrade your home? The end of the mining boom in WA has had an undeniable impact on the state’s economy and property market. Prices are down and apartment vacancies are up, making it a true buyers market. But it’s not all doom and gloom. There are still property hotspots if you know where to look for them. Suburbs that have bucked the negative trends and experienced double digit growth in the past financial year. These bright spots exist because people are seeing the market slow down as a chance to upgrade their home, snapping up top end properties that have had hundreds of thousands taken off their asking price due to the economic slow down.
Making the right decision for you.
While these market conditions may not be friendly to first time home buyers or those selling, there are ways to make smart property decisions and pocket some extra cash if know what you’re doing. It’s the upper end of the housing market that has taken the biggest hit, with homes priced above the $700,000 having huge amounts slashed from the asking price. If I look around my local area in Attadale, East Fremantle and Bicton, I see properties that would’ve been worth over $1.2 million a few years ago now selling for $900,000.
However, if we compare these riverside suburbs to suburbs on the other side of Canning and Leach Highways, the suburbs across the road with lower median house prices have stayed relatively stable. In Palmyra, Myaree and Willagee the median house price is under $700,000, which is where the market demand seems to be at the moment. People are looking to buy affordable properties that still provide excellent proximity to the coast and city, giving stability to prices in these suburbs.
Looking for lifestyle
Further to this, people are also looking to buy in lifestyle locations. Hence the continued popularity and growth in beach side suburbs. South Fremantle in particular has experienced strong growth this financial year, with a median house price of just over $1 million, showing an increase of 7.2 percent. People are still willing to spend good money in this area because it represents a stable investment and associated lifestyle benefits being close to the centre of Fremantle.
Take advantage of the low interest rates
Bearing this in mind, I believe if you are considering upgrading your family home to a higher priced home closer to the river, city or ocean, now is the time to do it. Even if you were considering a time line over the next 5 years, the combination of low prices and interest rate cuts has provided a perfect mix to find a bargain. The RBA has kept interest rates low for the past quarter, and now commodity prices are slowly starting to lift, so we could be starting to see a rise in the market. Although the market is slowly improving, I don’t think we will see it go up in leaps and bound any time soon. While market conditions remain as they do now, it is the perfect time to take advantage of houses that have been on the market for a while.
For example, if you have a property in Willagee that in its peak may have been worth $700,000, it will probably only now fetch $650,000. To make the most of your money, you could upgrade to a home worth $900,000 in Attadale, East Fremantle, or Bicton that may have been worth $1.2million at its peak. Hypothetically you could save yourself up to $250,000 in this transaction.
Owner, Director, Board Member,
Community Member, Mum
Disclaimer: This shouldn’t be considered investment advice and is only a general comment that doesn’t take in to account your specific circumstances.
If the above hypothetical appeals to your desire to upgrade your home, make sure you play it smart when selling. Put your house on the market first, get cashed up, and then put offers on properties that are only subject to
the successful settlement of yours. By selling first, you can make smart financial offers instead of being caught up by the emotion of buying your dream house. When the perfect house comes along you’ll be ready to put in a
smart offer that the buyer can’t refuse. This will also ensure you don’t get yourself stuck in a subject sale situation, and so you can take advantage of properties that have been on the market for a while- submitting strong offers that get you a discount. Remember, you make your money when you buy, not when you sell.