Information supplied by Pindan
The mining industry in Western Australia continues to be the mainstay of our economy. And with a booming industry comes a workforce – and a workforce that needs a place to live.
Mining activity in WA’s north and the subsequent population pressures will continue to drive demand for property in Western Australia. This includes housing markets in both the Perth metropolitan region and north-west. Both are still undersupplied and smart buyers are not ignoring the signs of steady property growth.
But what makes for a good investment property and what should you look for? Here are our top three tips on what to consider in your search for the perfect investment property for a mining workforce.
1. The location
Western Australia’s Pilbara region has been known as a hot spot for property investment for years now. Fueled by Western Australia’s mining boom, properties in areas such as South Hedland, Port Hedland and Karratha all continue to be a good place to buy an investment.
South Hedland is still very much a bullet-proof place to buy property. The population growth of South Hedland has surged from 13,000 in 2006 to 19,500 last year and is set to rise further with many projects moving to production phase and requiring a long-term workforce. The Pilbara Industry Community Council predicts that the population of South Hedland will grow to 21,000 by 2015, whilst the Port Hedland Council has a vision for 40,000 by 2025.
The huge rate of population growth creates a massive demand for homes that’s seen median house prices in South Hedland soar to $866,000, up from $260,000 just seven years ago. Rental returns are reflecting that demand with the median South Hedland housing rental now $1,525 per week, with the median rent for units at $1200 per week (REIWA April - June quarter 2013). Investors in South Hedland have consistently enjoyed rental returns of 10-13% in the last decade compared to the Perth average of 4.3%.
2. The amenities nearby
Look for a property that will appeal to the mining workforce. Demand for good quality houses in areas such as Port Hedland and South Hedland are in strong demand - with properties averaging 30% returns per annum when taking into account capital growth and rental yields.
The reason why these areas are in such high demand is that they are self supporting towns with all the amenities your average person or family could need!
Many of the mining workforce moving to these areas are families who don’t want the Fly In Fly Out lifestyle and therefore are looking to buy in areas that are close to schools, shopping centres and recreation facilities.
South Hedland, for example has the South Hedland Aquatic Centre that has recently undergone a $9 million upgrade, a soon to be redeveloped shopping centre, Wanangkuru Stadium, South Hedland Sports Complex and is within an easy drive of a range of schools.
3. The property itself
Look for a property that will appeal to a mining workforce and consider the needs of shift-workers too.
Tenants and companies looking to house their workforce are looking for comfortable housing that is well built and has quality fixtures and fittings. And in WA’s north-west, air conditioning is a must!
Low maintenance, lock up and leave properties are suited to the busier lifestyle, so look for boutique developments that provide a sense of community and security to support this.
Proximity to key facilities and services is also a major drawcard for homeseekers; so choose the highest quality property that is closest to shopping centres, recreational facilities, and other essential amenities.
For more information about investing in South Hedland, visit http://www.barrowsouth.com.au/Investment.aspx
Disclaimer: while due care is taken, the viewpoints expressed by sponsors do not necessarily reflect the opinions of Your Investment Property.
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