Is buying an investment property in regional WA a good idea?

With the regional sales and rental markets both experiencing strong demand, should investors be looking outside of the city for their next investment property?

REIWA President Damian Collins
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There is growing opportunity for investors to take advantage of the favourable market conditions in regional WA. 

REIWA recently released its March 2022 quarter data which showed regional WA had had another strong quarter. Eight of the nine regional centres saw an increase in median house sale price during the three-month period, while all nine recorded median house price growth during the 12-months to March 2022.

This price growth trajectory extended to the rental market, with reiwa.com data revealing all nine regional centres recorded median rent price growth during the 12-months to March 2022. Couple this with low vacancy rates and fast median leasing times, and it is clear there is strong demand for rentals in the regions.

What to consider when choosing where to invest

With the regional sales and rental markets experiencing strong demand simultaneously, should investors be looking outside of Perth?

The kind of investor who would be well suited to buying in regional WA is one who has built a well-established portfolio. Investors with established portfolios can generally take on more risk, but this strategy does need to be considered with care.

While investing in regional areas is potentially riskier than larger cities, regional investments also have the potential to deliver a greater upside. If a regional town’s economy booms, then this can cause property prices to spike, which is what we are seeing in a number of the regional centres. 

For example, the Pilbara’s thriving commodity market has resulted in strong price growth in Port Hedland and Karratha recently. In fact, Port Hedland was the strongest performing regional centre in the 12-months to March 2022, with its median house sale price increasing 40.6 per cent to $457,000 during this time.

Clearly with price growth like that, there is good opportunity for investors, but this needs to be undertaken with a level of caution. Is that market prone to steep rises and falls? Is buyer demand likely to remain strong in the area? What projects or investments are planned in the area that might impact population trends and house prices? 

Every investor’s plan is different, and there is no one-size-fits-all strategy for property investment. If you’re considering investing in regional WA, it’s a good idea to speak with a qualified professional who specialises in investment to discuss the right approach for you.  

More information

If you’re interested in finding out more about how the regional property markets are performing, head to our WA market page. 

Alternatively, have a chat with a local REIWA agent who specialises in investment about what options are available to you.