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Spike in investor confidence in WA

Friday, 2nd Feb 2018

 

Perth property investors are increasingly more optimistic about the property market as the shifting sentiment from East to West continues.

The latest Momentum Wealth annual Property Investor survey of 417 property investors across Australia revealed that 67% of investors in WA thought now is a good time to buy an investment property. This represents a significant increase of 29% from just 52% the year before, signifying a noticeable shift in investor confidence.

The survey also found Perth to be the most appealing capital city to invest in, with 41% of respondents preferring the recovering market to other capital cities in the East.

The growth in confidence can be attributed to a change in overall sentiment towards the state’s economy and property market. Perth has seen more positive economic indicators such as continued job growth throughout 2017, and the property market has recently produced and maintained more optimistic numbers: falling stock levels and increased buyer activity may well indicate the market is about to turn, though it is unlikely that the growth will resemble that of the boom times.

The survey also indicated that buyer’s agents have become more popular among investors, with an additional 4% of investors acknowledging to engaging their services. Interestingly, 68% of these investors report owning at least two properties in their portfolio, making the case that more successful investors highly value the expertise a buyer’s agent can bring to the process..

Finance can be a barrier or boost

An increased number of respondents commented on the difficulty of securing finance after the recent APRA lending restrictions were implemented.

While the recent low cash rate has brought fixed and variable rates down to historic lows, many investors have been impacted by the tougher APRA guidelines put in place to cool the overheated eastern states markets. Investors are urged to consult with their broker should they wish to take advantage of the shifting market.

Commercial property – desirable but difficult to attain

The number of respondents who definitely would consider investing in commercial property was up 2% on last year’s result, however, the high purchase price and level of knowledge required to secure a strong performing commercial investment can be difficult barriers to overcome for many investors.

While there are considerable benefits to investing in commercial property, it is generally more suited to experienced investors who can respect the risks involved and have an understanding how this type of investment would support their overall property investment strategy..

Because of the complexity, risks and cost of entry, it is essential aspiring commercial property investors seek professional, independent advice before taking the first step.

Overall perspective – smart investors to benefit this year

The findings were observed from Momentum Wealth’s annual Property Investor Survey, which captures the latest trends and preferences of Australian property investors.  If you would like to read the full report, you can download it here:

Download Investor Survey Report 2018

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