Hudson would like to introduce Daniel-Paul Filippi, the Principal of Projects WA. After an extensive search and a trip to Perth, we are very excited to have found someone with so much knowledge and appreciation of Perth. To summarise, Daniel has access to most of, in fact I’d say pretty much everything, that Perth has to offer.
We discussed opportunities in Applecross (has one of the best high schools in the state), Nedlands/Crawley (University of WA and the hospital precinct), Rivervale, Kensington, Fremantle, Scarborough, Cottesloe and Subiaco.
Daniel outlined a number of suburbs that west coast developers were trying to sell to the east coasters and flagged them as areas not to buy. Daniel only deals with developments under construction as building prices have gone up by 40% in Perth and lack of construction labour is not getting any better. He also can source any sort of property investment or potential owner-occupied home.
Daniel is full of local knowledge and has worked in property and property developments for decades. He has agreed to work with our clients and can help source any property, from development opportunities in Fremantle, to old villas to brand new lifestyle apartments. He really likes the west corridor but works in the east corridor as well and brings a discerning voice to decisions, especially for clients on the east coast who are not familiar with Perth. Daniel tells me that Perth property has only just caught back to prices seen in 2012, so he believes that there are still a few good years in Perth. Perth prices experienced about a 20% decline between 2014 and 2020, attributed to weak economic conditions and negative population growth.
Perth offers one of the best opportunities in Australia at the moment and it is being overlooked by investors who are still preferring the bigger cities. Here’s why we like Perth;
- Perth is economical in comparison – median home value at $588k
- Rental returns are highest in the country at 5.3%
- Vacancy rate is at 0.7%
- population growth is at 2.3%
- Growing data centres and close to Asia and Europe
- Top 5 walkable cities in Aus
- Kings Park is 60 hectares larger than Central Park
Funnily enough, investors are seen to be much more active in NSW where rental yields have been the lowest of any state, the buy-in price is significantly higher, and arguably the prospects for capital gains could be significantly less when you consider the affordability challenges that remain apparent across the Sydney marketplace. Australian Bureau of Statistics showed that NSW received the bulk of investors accounting for 38% of the value of new mortgage lending across the state.
CoreLogic state “Both Western Australia and Queensland have a positive rate of interstate migration which better aligns to purchasing demand, as opposed to overseas migration that tends to be more aligned with rental demand.”
Sydney and Melbourne do have a stronger history of capital gains, but with higher median prices, this could diminish opportunities for those with less capital to invest, as well as potentially dampening capital gain opportunities going forward. An interesting read on changing the way we see the inner City of Melbourne and Sydney, to more like the inner city of Singapore, is being touted a possible way forward out of the housing crisis. Time will tell.
Brisbane is seeing very limited supply with limited new stock and a higher entry point thanks to the last 3 years of growth seen in Brisbane. I love Adelaide as a City but the migration into Adelaide is not as strong, and Hobart has had such a huge growth run that opportunities are also more limited.
If you’re looking for the best of both worlds, again, Perth and southeast Queensland have a higher yield profile but also feature arguably stronger prospects for capital gains, considering a healthy mix of housing demand from a blend of interstate and overseas migration, along with more modest prices relative to the larger capitals.
We have highlighted some of the projects we are excited about below. We are honoured to have Daniel agree to work with Hudson clients as it’s been very hard to find someone whose investment principles and philosophy align with ours. If you would like access to Daniel either talk to your adviser or email yes here and we will send you the Hudson link that gives you direct access to Daniel.