Western Australia has a national reputation as an ‘active, lifestyle oriented state’. Our climate and the abundance of wide-open space have always promoted an interactive, outdoor existence. With more and more homebuyers searching for their dream lifestyle residence the magnetic pull of locational attributes such as our coastline, rivers edge and parkland is as powerful as ever.
When a property is situated in a desirable location and offers a pleasant aspect or outlook, it will always be sought after and be in a position to command a premium selling price.
If you are considering buying a property then you should give thought to the ‘scarcity’ factor. This scarcity factor of the property will determine its long term capital growth and value of the home. Homes that a located in areas offering benefits that aren’t on offer other suburbs will achieve the highest capital growth rates.
On the opposite side of the scarcity factor, homebuyers should avoid buying in areas where their property can be easily replicated.
Many homebuyers make the mistake of not examining the long term scarcity factor of their home and buying a home based on emotions. As a result, they only achieve at best an average market capital growth rate in the value of their property.
Lifestyle opportunities continue to drive Perth property prices with a growing number of Western Australian’s taking advantage of the benefits derived from living near water.
One of the most significant trends in property value growth in the Perth market is evident in those areas that are located near either the river or ocean. Additionally, properties situated near a marina are also keenly sought. This is supported by the strong growth in values in areas such as Hillarys, Fremantle and Mandurah. Similarly, areas surrounding the proposed Port Coogee Marina development are already reflecting good growth in anticipation of the benefits that will flow from this project.
Coastal suburbs provide consistent growth for investors and are traditionally the last suburbs to feel the affects in a contracting property market. They will also be the first suburbs to recover in a growing market.
The fundamental principle in purchasing property of ‘location location’ is not always limited to a property’s direct proximity to water. Other desirable outlooks may include attractive views, being located adjacent to or opposite a park or open space or in close proximity to a relaxation amenity such as a golf course.
A key factor that many homebuyers overlook when purchasing a property is the value of the land content. Buyers should look for 80 per cent land content and 20 per cent structural content in the overall value of the property in order to gain the best possible performance of growth in that property.
