Comment News (Armadale) - - Residential -

WHEN it comes to real es­tate, it is not what you pay but what you buy, ac­cord­ing to Gavin Heg­ney Prop­erty di­rec­tor Gavin Heg­ney.

Speak­ing last week at the an­nual Western Sub­urbs Busi­ness As­so­ci­a­tion Prop­erty Mar­ket Up­date din­ner, he used two ex­am­ples from 1983 to make his point.

The first was a four-bed­room Ar­madale home with a pool in a quiet culde-sac priced at $47,500 and a “bar­gain­priced” $45,000 char­ac­ter home in South Perth, most likely on an 800sq m block.

He said while char­ac­ter homes in South Perth were not in de­mand at the time, this would have been the bet­ter buy.

The sec­ond ex­am­ple in­cluded two homes for sale in In­gle­wood.

One was an old, two-bed­room char­ac­ter home most likely on a quar­ter­acre block close to shops and priced at $46,950.

The other was a “lux­ury” two-bed­room villa in a com­plex of eight priced at $45,750.

At the time, homes near shops were dis­counted be­cause the lo­ca­tion held lit­tle ap­peal, yet it would have been the bet­ter in­vest­ment.

Mr Heg­ney said th­ese ex­am­ples showed you had to buy the right prop­erty and let time do the work.

“Over time, land tends to ap­pre­ci­ate in value and build­ings tend to de­pre­ci­ate, all things be­ing equal,” he said.

“Land your as­set, be­comes build­ings your li­a­bil­ity.”

Mr Heg­ney said if you wanted to be a suc­cess­ful in­vestor all you re­ally needed to do was buy 50-year-old homes.

“Over the longer term build­ings at about 50 years old be­come time­less and re-ap­pre­ci­ate, which is why we’re see­ing a lot of the ’60s homes in fash­ion now,” he said. “What you buy is far more im­por­tant than what you pay and over time, pick the right ones and you’re do­ing ex­tremely well.”

Mr Heg­ney said ar­eas and trends worth pay­ing at­ten­tion to over time in­cluded the Ocean Reef ma­rina.

“If you put a ma­rina into an area, his­tory says val­ues go up,” he said.

Mr Heg­ney ex­pected the Scar­bor­ough beach­front to be­come one of Perth’s top tourist des­ti­na­tions when com­plete and the area to cre­ate its own de­mand over time.

He also iden­ti­fied the North­bridge precinct. “Ya­gan’s Square will re­shape Perth as El­iz­a­beth Quay has re­shaped Perth,” he said.

Fre­man­tle watch.

“It’s re­ally go­ing to go from strength to strength over time,” Mr Heg­ney said.

“There’s go­ing to be some good op­por­tu­ni­ties, but re­mem­ber the In­gle­wood story, let’s not just go buy in Fre­man­tle for the sake of buy­ing in Fre­man­tle; buy the right thing and right lo­ca­tion.”

Mr Heg­ney said in­vest­ment suc­cess was not about lo­ca­tion, lo­ca­tion, lo­ca­tion, but lo­ca­tion, po­si­tion and tim­ing.

Other trends to watch were Metronet and the den­sity/zon­ing around train sta­tions where a lot of older ’70s and ’80s homes on large blocks could be split up into a num­ber of apart­ments.

“That re­zon­ing adds value,” Mr Heg­ney said. “Make the most of that in­fra­struc­ture; you’re go­ing to see a beau­ti­fi­ca­tion of the area, lift in val­ues and that amenity.”

For­rest­field, Red­cliffe and Bayswater train sta­tions were good ex­am­ples, ac­cord­ing to Mr Heg­ney.

Val­ues in th­ese ar­eas were down 20 to 30 per cent over the past two years.

Mr Heg­ney said de­vel­op­ment sites had taken a beat­ing in the down­turn, but tended to re­cover quite sharply when the mar­ket turned.

“It will turn, mar­kets will al­ways turn and when it does, de­vel­op­ment sites will come back into vogue,” he said.

Sur­vey strata and du­plex sites also of­fered op­por­tu­ni­ties in all ar­eas. was another place to

Gavin Heg­ney gives tips.

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