The re-election of the Liberal Government in WA restores stability for property investors in north-west WA, writes Crawford Property Group director Ryan Crawford
The re-election of the Liberal government in WA appears to have garnered a positive response from the resources industry, suggesting that it is both content with the level of support it has been given over the past four years and satisfied with the policies the Coalition will carry into its new term.
With government support remaining solid for the resources industry and the regional economies that are critical to its operation, the re-election should also provide a sense of comfort and stability for property investors in WA’s north-west mining towns.
The government will maintain its most significant policy affecting the region, the $1.1bn Pilbara Cities Initiative, which will continue to transform Karratha, Port Hedland and Newman into regional cities. Numerous civil infrastructure, health and education projects have been completed with many still in the pipeline:
Port Hedland: The state government, council and private developers (in partnership with the government) have committed $1.1bn in civil infrastructure projects ranging from the redevelopment of the airport and main highway to the new waste water plan. Community development projects include the revitalisation of the South Hedland town centre, multi-purpose recreation centre and aquatic centre.
Karratha: As part of the government’s plan to revitalise Karratha as the City of the North, it will benefit from a massive $771m in civic infrastructure projects with two projects at Karratha Airport underway and a proposed new hospital.
Newman: Newman has $70m in planned civil infrastructure projects such as major sports upgrades.
Although the Pilbara Cities Initiative aims to leverage private investment for the development of new residential dwellings, development is proving slow due to the lengthy planning and application process created by the government’s 2012 Building Act. With the ongoing undersupply of housing in the towns, demand remains high.
During its pre-election campaign, the government also pledged an additional $20m to the resources industry with funds to be allocated to a variety of programs focused on supporting the sustainable growth of the industry.
It remains committed to its $138m Exploration Incentive Scheme which encourages further exploration for minerals and petroleum in WA and will continue to support the development of the state’s uranium resources. The undeveloped Kintyre uranium project in the Pilbara is one of the world’s largest uranium deposits.
The development of WA’s vast reserves of shale and tight gas, including the onshore development of Woodside’s Browse LNG plant in the Kimberly area have also received strong government backing.
Woodside will make a Final Investment Decision on the project by June and it will have a major impact on the northwest economy. An onshore facility will open up significant opportunities for property investors in Derby and Broome.
Aside from this ongoing support for resources and regional infrastructure, one of the potentially most valuable policy developments for property investors to have come out of the pre-election campaign is the proposed change to the ‘granny flat’ legislation. The government has committed to changing the residential design codes to allow any tenant – not just family, as is currently the case - to occupy granny flats. It has also increased the allowable floor space from 60m2 to 70m2.
Normal planning requirements around setbacks and density will continue to apply but the change will give investors the flexibility to add a granny flat to their property and increase their rental yield, enabling them to generate hundreds of dollars more each week.
The addition of new policies such as this and the ongoing implementation and enhancement of existing policies focused on supporting mining town economies mean, at the very least, property investors can expect more of the same from their positive properties in WA’s northwest – excellent yields and good capital growth.
Crawford Property Group originated in the Pilbara around five years ago and specialises in property investment. Ryan Crawford is the founder.
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