Perth Apartment Market

[kph]

http://www.finbar.com.au/thesaint/

Wonder if the market for Perth still has legs ?

These guys are so slick with their marketing via their client and enquiry database that they hardly require the agents any more.

Does anyone think these are good value and worth considering ?

kp

 

[Trogdor]

http://www.finbar.com.au/thesaint/

Wonder if the market for Perth still has legs ?

These guys are so slick with their marketing via their client and enquiry database that they hardly require the agents any more.

Does anyone think these are good value and worth considering ?

kp

Dont know anything whatsoever about perth but this looks awfully high rise/new (low land content, high margins for developer, high body corp, blah blah).

Surely there would be better value in nearby areas in houses/townhouses/older style low rise units?

 

[Ausprop]

wow - settlement 2010 ! I submitted my interest. building costs and inflation will have eroded todays asking prices come settlement time.

you have bought from Finbar before right kph? were they ok?

 

[kph]

They were excellent.
Have a good reputation in Perth.

Spoke to the builder on site a few weeks back and he was saying that Finbar have changed their marketing by not selling EVERYTHING off the plan, as they missed out on huge gains by locking in the profits early and then suffering huge delays in getting the construction underway much delayed, through the whole Perth boom of the last 3 yrs.

Of course this time the opposite will probably happen, and they will have minimum pre sales and then the market will stall when the construction is completed.
I wonder how they can hedge for this ??

 

[kph]

Dont know anything whatsoever about perth but this looks awfully high rise/new (low land content, high margins for developer, high body corp, blah blah).

Surely there would be better value in nearby areas in houses/townhouses/older style low rise units?

Perth does not have any real 'high' hi rise or huge complexes of apartments coming up at the same time in the same spot.
CBD apartments are a relatively new idea for Perth, compared to other more established cities.

So at this stage it seems to be a baby boomer, lifestyle change attraction to them.
Also, there is now a lot of demand from corporate and professional tenants on 6 and 12 month assignments to Perth who prefer to stay in an apartment close to the city office. ( all this according to the agent who is trying to convince us to rent ours out via them)

I don't think there is heaps of 'value' in anything close into the CBD as Perth prices have run so hard for the last 3 yrs, so the apartments are probably having their time in the sun atm.

This might change if the 100's of apartments get approved and promoted that are proposed for the old brewery site. ( ex Westpoint development)

 

[Dazz]

bought from Finbar

These guys are good, but I wouldn't buy their finished product.

Four months ago we went head to head with them, competing for a future development site, currently a large school sitting on 2 acres in Highgate.

The site was zoned R80, and was able to accomodate 72 units. They pipped us at the post with their offer. Transaction went through at 11.8 M, equating to 164K per site. Not bad for only 2km from the Perth GPO.

Current usage of the site was a school. The seller offered a leaseback for 7 years, with a 3 year option, starting with a nett yield of 5.93%. Tenant picked up all of the running costs of the site, equating to about 170K p.a.

With escalations in the Lease, the school whilst waiting to develop would turn positive cashflow by Yr 6.....thereafter the tenant puts cash in their pocket whilst they submit plans to council on the development site....nice.

They'll make a killing on that site when they pop up the 72 units and flog it off to the hungry public.

We'd rather get in at the good end, rather than pay retail at the back end.

 

[Ausprop]

"We'd rather get in at the good end, rather than pay retail at the back end."

couldn't agree more! now and then I'll take something that is retail tho where it looks as if you are benefiting from over cautious banks requiring presales in cahoots with valuers (that are just pessimistic historians - but of course if there is a good sale more than 6 motnhs ago that doesn't count!) particulalry with lovely long settlement time such as these. in recent times I have made more than the developers by doing some of these little flips.

 

[Ausprop]

ps - good to see you're still posting Dazzling!

 

[Ausprop]

update on this... the VIP launch was thrown out the window when they started taking early registrations. I got wind of it yesterday then the they sent an email confirming it. by the time I made sense of the plans and got back to the agent this morning there only 3 x 3 bedders left. so i grabbed one, leaving 2, probly all gone now. It's only an option to purchase at this stage, so will see what the contract looks like. hopefully delays will continue, material costs keep heading up, 2010 becomes 2011....

 

[kph]

Which takes me back to the original post.
I guess the answer must be 'YES'

No fat lady to be seen in Perth just yet.

I reckon its a pretty safe bet that 2010 will go into 2011.