Same can be said for Elephant + Wheelbarrow in northbridge along with many other places.
No customers, prices are still boom prices nobody can afford to drink $10 pint anymore.
Some places now offering cheaper beers to try get the punters in which is having success.
Still won’t help with house prices though.
Take an example as I was looking at Maylands area recently.
You can pick up a cheap apartment 1 bed in a run down looking complex for
$200-250k. You could get a mediocre 2 bed apartment for $350-400 or you could buy a 3 bed villa for $400-500k
1. For the 1 bed you would get rent approx $150- 200 p/w.
2. For the 2 bed you would get rent approx $250-350 p/w.
3. For the 3 bed you would get rent approx $300-400 p/w
1. Yearly income $7800 - 10,400
2. Yearly income $13,000 - 18,200
3. Yearly income $15,600 - 20,800
Let’s take the midpoint on price and rental to give return each;
1. 4%
2. 4.15%
3. 4%
These are returns before taking into account insurance, rates, lost time from not being rented, maintenance, real estate and purchasing fees etc etc etc.
So your likely looking at less than 3%.
You can easily obtain better returns through dividends in the sharemarket with much less hassle.
This is an example of just one suburb, others may be better or worse.
If I was truly interested in buying a place, I wouldn’t be buying it unless I can get a 6% return.
I see plenty of properties in the UK with 8%+
The only caveat to this is some people want a home not an investment but I personally think it’s both and would have both in mind during a purchase of a home. All the above factors for me point towards Perth still being way overpriced.
