Property prices in Perth are stabilising, according to the latest figures from RP Data.

At the same time, one mortgage broker is claiming that investors are returning to the WA property market. Rael Bricker, managing director of House + Home Loans, was quoted by REB Online as saying:

Investors are definitely back buying. They’ve worked out that the market has bottomed out and that from here on in it is a buyer’s market.

Now there is stability in the market and very strong rental demand off the back of the momentum in resources, with yields back up to 4.5 to 5 per cent.

Two months ago, I asked: is it time to invest yet? Yesterday’s REB Online article would suggest that the answer is yes.

But meanwhile, respected property investor Michael Yardney says that it doesn’t matter whether the market has bottomed or not:

The moment you leave your success or failure up to what direction the market goes, you’re in trouble… Timing the market is what unsuccessful investors do…

Here’s what smart investors do to create long-term wealth:

First, they become educated in a specific asset or investment strategy. They read, they learn, and they understand. They don’t just throw money into an investment on a “hot tip” or because everyone else is doing it.

Second, they choose an investment strategy that suits the market.

He goes on to say that smart investors can make money whether the market is in a slump or not, and that a good strategy is to “get educated” about what investment practices are working.

I agree on this point – education is the most valuable step a property investor can take. With proper research, you can find out what’s working for others, work out exactly what you want, and even get a better deal.

What do you think? Has the WA property market bottomed out yet, and does it matter?

Image by Mal B via Flickr.

In fact, because properties like units and villas are part of a strata plan, they come with their own set of unique considerations to take on before buying the property and proceeding to settlement.

Here are three important things to consider when buying a strata title:

1. Is it my property, or common property?

The parts of the strata plan which belong to the strata company (in which each lot owner is a shareholder) are common property. Find out what’s part of your property, and what’s common property, because this will affect how you use it! Ask your real estate agent whether things like:

• The garden,
• The carport,
• The driveway, and
• The courtyard

are common property, before you commit to buy!

2. How much are the strata levies?

Every owner of a strata title will have to pay a regular strata levy to the strata company for:

• Regular upkeep of common property,
• Taxes and other expenses, and
• Occasional costs, such as roof repairs.

Strata levies vary between strata plans, so find out from your real estate agent how much the regular levy is – you’ll want to consider this in your quarterly budget.

In addition, every now and then a strata company will raise a one-off special levy to undertake a large maintenance job such as painting the exterior of all units, or replacing the driveway – these can be upwards of $1000. You could be required to contribute to this levy at settlement, so ensure you ask if there’s one raised when you make an offer.

3. What are the by-laws?

Strata companies have their own set of rules, or by-laws, created by the company. They govern all lot owners, and affect things like:

• The appearance of units,
• Damage of common property,
• Obstruction of common property,
• Garbage disposal,
• Cars and parking, and
• Pets.

Clearly, these will affect your (or your tenants’) daily life in the property, so find out what these by-laws are before committing to buy the property!

These are just three things to consider when buying a strata title – see Landgate’s website for more information on strata titles.

Image by Richard Taylor via Flickr.

We followed the news and reactions on Twitter:

Lee Baston – @bastonproperty
Reserve bank leaves the cash rate unchanged at 4.25% #perth

 

Business Spectator – @BusinessSpec
No surprises as #RBA leaves official cash rate on hold at 4.25% http://t.co/hsERacRa

Various tweeps tweeted out some great content explaining RBA’s decision and it’s potential impacts:

NAB – @NAB
.@RBAInfo has left the cash rate on hold – see what our Economists think & what it means for the Aus Economy http://t.co/9aUgpoJJ [VID] ^AB

Glenda Kwek – @curious_scribe
If you want to read more about #RBA decision to leave #rates unchanged at 4.25%, here’s statement by Glenn Stevens http://t.co/oziUeKq3

Michael Yardney – @michaelyardney
The RBA has left interest rate unchanged for a second consecutive month. What does this mean for you as an investor?http://t.co/ENc4D3bm

And adding to the speculation:

realestate.com.au – @realestate_au
#RBA keeps rates steady, but what will the banks do?

Overall, the RBA’s decision to keep interest rates on hold shows that it suggests no need to ‘bail out’ the Australian economy. For more updates on interest rates (and more) I recommend following tweeps like @BusinessSpec and economist @MichaelYardney.

Who do you think are the best source of financial news?

We follow a bunch of Perth real estate agents on Twitter, and I recommend you do too – it’s a great way to keep updated with what’s happening around Perth.

Here’s my favourite tweets from Perth agents this week:

Wellstead Team – @wellsteadAUS
Got no plans tonight? How about checking out Comedy Wednesday at Perth’s new rooftop cinema in Northbridge http://t.co/RU19bZdE

The new Perth Rooftop Movies venue (above the old IMAX building in Northbridge) is open until April 11 – see the schedule at EverGuide Perth.

Natalie Hoye – @NatalieHoye
@Ressetts Love #pinterest! Tremendous amount of sharing and re-pinning – like Facebook on steroids. The content has a really uplifting vibe.

In social media news, Pinterest‘s popularity is exploding around the globe, and it’s piquing the interest of Perth agents.

Pam Herron – @pamjherron
First wine of the day with @peterfletcher @LoriGrech and @_emilysauce but no @bastonproperty or @NoshGourmet etc

Pam’s talking about our third Digital Marketing Workshop for Perth agents, which had wine, nibblies, and plenty of learning – thanks for coming along, everyone! RSVP to our next workshop by giving us a call on 9459 0044.

Lee Baston – @bastonproperty
Well its here again…Free Coffee Friday at The Imp in East Vic Park, see you there http://t.co/g8Ig2m1r

Lee and Derek Baston had their second Free Coffee Friday today at The Imp – anyone who mentioned Baston Property got a free coffee!

Davide Palermo – @dpalermo79
We all know it’s free coffee friday but what about the other days of the week? Magharita Monday’s, wheatgrass Wednesday? What Do you think?

Love those ideas (especially Magharita Mondays!). If you’re on Twitter, it’s definitely worth adding these tweeps to your follow list for regular updates on what’s going on in Perth, and in property.

There's plenty of available development land

Land in Perth is now the most expensive in the nation, or so it’s claimed by a report released by the Housing Industry Association and RP Data.

According to the WA Today:

The price of land in the Perth metro area at the end of last year was $521 a square metre, up $73 on three months previously.

That is $24 a square metre higher than Sydney, where prices went the other way, falling $69 a square metre in the three months.

While the median price for a typical block in Sydney was higher than Perth, the NSW capital has a larger average lot size.

The median price for a block in Perth surged 8.4 per cent, to $245,000, despite a sharp fall in sales, from about 2500 the previous quarter to about 1800.

Despite the fall in sales, the report’s authors said that previous quarterly volumes had been strong “which will stoke the fire of the strongest housing recovery in the country”.

“WA can expect a very solid year of new home building in 2010… however the maintenance of a steady supply of affordable land for residential development is required for a sustained housing recovery.”

The median lot price in the South-West rose $12,250 to $170,500, while the South-East saw a $2500 rise, to $150,000.

While the report suggested a strong year ahead for the housing market it appears to have glossed over the reported fall in Perth land sales. Much of the spike in sales was caused by the first home buyers boost. That’s no longer available.

Perth is in the midst of a resources boom led by “…China’s stockpiling of commodities and…the Gorgon LNG project” the report claimed. And although Perth’s rental vacancy factor is higher than other capital cities there are signs that it is “tightening”. That’s good news for investors.

Driven by buoyant job prospects the population in WA is expected to surge. As it does, demand for accommodation will put upward pressure on rents making investment in the West more attractive.

The report went on to recommend that the best property types to buy in Perth was “middle-ring beachside suburbs, and the inner south and west adjacent to the CBD.” Just why Wakelin’s chose these property types was not made clear.

REIWA’s preliminary data for the December quarter shows median house prices up 14.3 per cent from December 08 to $480,000.

Mr Bourke attributed strong property growth to a change in the market from first-home buyers to trade-up buyers.

“2009, as a result of the First Home Owner Boost, saw 42 per cent of all sales being first-home buyers and of course they buy in the under $500,000 market so the median price moved down.

“As they’ve slowly left the market and the next wave of buyers, the trade up buyers, have moved in, buying in the segment between $600,000 and $1 million, the median price has moved up to reflect that they are now the most predominant buyer in the market.

“2010 is going to be the year of the trade-up buyer.”

Mr Bourke claimed that one of the key drivers of price growth has been the ongoing shortage of land, which increases demand for existing accommodation.

Posted via web from peterfletcher’s posterous

Posted via web from peterfletcher’s posterous