TODS – PropertyESP

Appetite for additional car bays prevalent

Recent research conducted by WA Apartment Advocacy has shown that while 70% of the 174 respondents were happy with their allocated parking bays in their apartment development, an astonishing 50% would be prepared pay an additional $25,000 for another car space.

Of the 30% who were not happy with the number of allocated parking bays, the majority of these were residents with just one car bay.

We have often heard the mantra from developers that they would be happy to provide additional bays if buyers were prepared to pay for it and this data now suggests that the appetite for extra parking is in fact prevalent.

This largely stems from the fact that 50% of the respondents were still reliant on their vehicles for work, shopping and leisure and while the Metronet will alleviate this situation, it is still somewhat in the distant future.

Interestingly 15% of respondents who did live close to public transport were prepared to forfeit their car bay and save the $25,000 on their apartment price.

The data also showed that 30% of the respondents were unhappy with the allocation of visitor parking in their development, with many citing that residents were using these bays as an overflow measure.

For some time now Local and State Governments have been seeking to lower the ratio of car bays to apartments and yet the research does demonstrate that this planning move is somewhat premature.

The research also begs the question as to why developers are not seeking to sell car bays as an ancillary aspect to the apartment itself.

Further improvements that residents were seeking to their parking woes included electric car charging points, dedicated car washing/cleaning bays, larger parking spots and greater security.

This research – if nothing else – clearly shows that developers need to be researching their buyer’s needs before making any assumptions. This will undeniably assist with their own design process as well as overcoming imposts by planning regulators.

If you are interested in hearing more about WA Apartment Advocacy and its research results register at www.waaa.net.au.

Apartments transform suburbs – and for the better!

Curious to see what has happened with the recent 2016 census, PropertyESP took a look at 3 suburbs that have been transformed by apartment developments to see what other changes to the suburb this had brought.

East Perth – originally an industrial suburb, EPRA (now MRA) was established in 1991 to redevelop and urbanise the suburb. It did so with the development of Claisebrook Village, with introduced 1450 new dwellings as well as retail and commercial properties on the site of the former East Perth Gasworks, scrap yards, contaminated industrial sites, empty warehouses and railway yards (Source: MRA Claisebrook Village Fact Sheet).

In the 2001 Census of Population and Housing, East Perth (which is broader than just Claisebrook Village) had 1631 occupied private dwellings that were apartments and flats (making 81.2% of all occupied private dwellings in the suburb). By 2016, this had risen to 4018 apartments and flats (88.8% of occupied private dwellings). The big transformation of East Perth occurred between 2006 & 2011, with the addition of 1160 occupied private dwellings that were apartments and flats (a 67% increase), and between 2011 & 2016, with the addition of 1125 occupied private dwellings that were apartments of flats (a 39% increase).

What else changed in East Perth over this time?

There was a change from these apartments and flats being predominantly rentals to owner occupied. In 2006 and 2011, the level of owner occupancy was hovered around 34%. By 2016, 64% of occupied private dwellings that were apartments or flats were owner occupied. Over the same period, the level of owner occupancy for apartments and flats in Greater Perth was unchanged (around 32%). With the redevelopment, people are choosing to own and live in apartments and flats in East Perth.
Median household incomes for the suburb have surged ahead of Greater Perth. In 2006, the median household income for East Perth was $1106 per week … on par with the $1086 for Greater Perth. By 2016, median household income for East Perth had risen to $2301, well ahead of the $1643 for Greater Perth.
The types of households attracted to the suburb has changed. In 2001, 46% of East Perth households were lone person households and 29% were couple households. By 2016, the two were on par – 37% lone person households and 36% couple households. Both groups have remained relatively stable across Greater Perth over the same period. Whilst families have not been attracted to East Perth in droves – they currently make up 16% of households – they have risen in number, up 251% from 210 households in 2001 to 737 households in 2016.

Burswood – another older suburb that gained new life and widespread awareness with the building of the (then) Burswood Casino in the 1980s. The suburb was officially gazetted in 1993. Subsequent apartment developments in a similar vein to East Perth have continued to change the suburb but it’s location on the eastern bank of the Swan River provides for a different lifestyle experience to East Perth.

The 2001 Census of Population and Housing counted 187 occupied private dwellings that were apartments and flats (making 37.4% of all occupied private dwellings in the suburb). By 2016 this had risen 183% to 530 occupied private dwellings that were apartments or flats. More importantly, this changed the housing profile of the suburb, with 57.2% of occupied private dwellings being apartments or flats. The really big transformation in Burswood occurred between 2006 & 2011.

What else changed in Burswood over this time?

As was observed in East Perth, there was an increase in owner occupancy of apartments and flats in the suburb. In 2001 and 2006, the level of owner occupancy was hovered around 21%. This rose to 36% in 2011 and 41% in 2016. Apartments and flats in Burswood are still the domain of renters, but it has seen a doubling of owner occupancy levels over 15 years.
Median household incomes for the suburb have surged ahead of Greater Perth. In 2006, the median household income for Burswood was $1091 per week … on par with the $1086 for Greater Perth. By 2016, median household income for Burswood had risen to $2273, well ahead of the $1643 for Greater Perth.
The types of households attracted to the suburb has changed as well. In 2001, 38% of Burswood households were lone person households and 31% were couple households. By 2016, the situation has reversed – 30% lone person households and 38% couple households. The proportion of family households has also increased, up from 18% in 2001 to 23% in 2016. In numbers, they have risen 14% from 87 households in 2001 to 213 households in 2016.

Cockburn Central – the first purpose built TOD in the Perth metro area. It was named in 2007 and was counted as a separate suburb for the first time in the 2011 Census. The 2016 counted 403 apartments or flats as occupied private dwellings, making up 70.8% of the 569 occupied private dwellings in the suburb. At 10 years of age, there’s not much history or transformation to explore. But as a purpose built regional centre for the surrounding area and designed with density and connectivity in mind, it serves as an interesting comparison to the other suburbs.

Firstly geography, Cockburn Central is 24km from the Perth CBD, connected by the Kwinana Freeway and Transperth rail. That makes it further from Perth than East Perth and Burswood. It has a number of employment opportunities close by, and is also well placed to connect to employment opportunities in the Perth CBD and the SW metropolitan industrial areas.

Who is living in Cockburn Central?

Cockburn Central is very much a renters suburb. At the 2016 Census of Population and Housing, 71% of occupied private dwellings that are apartments or flats are rented, higher than for Cockburn Central properties in general (58%). The level of renting is higher than for Greater Perth.
Median household income for the suburb is similar to Greater Perth – $1625 per week.
37% of households are lone person households (similar to East Perth), 34% are couple households (lower than East Perth but, like East Perth, the proportion of couple households is growing).

With the newness of this suburb, it does tend to however indicate that it may follow the same pattern as Burswood and East Perth in time.

As PropertyESP has always attested – apartments in the housing mix does tend to attract a more professional resident with higher disposable incomes and that is good for the LGA overall. If you would like to know what is happening in your suburb of development contact Sam Reece at info@propertyesp.com.au. We love to get into the nitty gritty!

Desire for East Perth to gain 24/7 heartbeat

Samantha Reece recently attended the East Perth session of the Cities Summit that has been co-ordinated by Member for Perth John Carey.

Over 60 people attended this session which comprised of businesses, developers, residents and interested parties.

Quite predictably the session dealt with the areas strengths, its problems and what the community would like to see occur.

East Perth was liked because of its walkability, the gardens and open spaces, Claisebrook Cove and the fact that the area felt calm and relaxed. In particular the residents enjoyed the fact that while they were living in the City it felt like they were in fact residing in a suburb.

However, there were certainly rumblings about the impact of foot traffic once the Stadium was completed and inexplicably this turned into concerns about safety.

But what was very clear was that East Perth has a Monday-Friday, 9.00am-5.00pm heartbeat and hence outside these times East Perth appears somewhat of a ghost town.

Some of the residents however enjoyed this low profile stating that they could travel to Northbridge and Perth for their entertainment. But this tends to fly in the face of what a TOD (and that is the basis for East Perth) is all about.

There was a sense that East Perth was missing small bars and night activation and that the vacant business premises detracted from the overall vitality.

The community certainly wanted to activate the area around Perth Mint and also turn Wellington Square into a pleasant space to recreate in – rather than avoiding it all costs.

The audience talked about movies in the park, markets at the WACCA car park, setting up pop up shops in the vacant premises and overall a more cultural atmosphere.

This obviously has a cost factor associated with these activation strategies and while John Carey may be seeking the City to hire a place maker for East Perth – it also needs people. There is no doubt that East Perth has been undercooked for density – like Subiaco – but this is an aspect that can be rectified as we move forward.

With the Stadium due for completion in 2018 this will certainly increase flow through traffic – but will they in fact stay and recreate in East Perth? And this is very much the issue of the chicken and egg scenario. Do you create the amenity so that people stay – or do you wait for the crowd and then create the activation?

Either way – there are some real opportunities for East Perth on its horizon and this community can either embrace it – or turn their back on it. But from the conversation we observed, there is a real desire to turn East Perth into a 24/7 destination and that will take input from all parties and not just a place maker hired by the City of Perth!

Would you invest $100 into WA’s future?

So at PropertyESP we are big fans of infrastructure and especially have been advocating that Metronet becomes a key priority with the newly elected Labor Government.

However contrary to our views, a number of developers have been reticent to endorse Metronet as they believe the development sector will be the ones forced to contribute with the value capture model.

Always focused on solutions, Samantha Reece Director of PropertyESP invited John Del Dosso from Colliers to present at the Property Council Residential Committee about other options that were also available to fast track Metronet.

John advised the Committee that if the Government was to charge a $100 levy/household per year they would raise $72 million. If that same levy was placed on commercial businesses then this would add another $72 million per annum. If you were to consider this as a perpetuating levy than in 5 years the Government would have raised over $600 million.

This is the exact model that Jeff Kennett applied in Victoria and as a result leap frogged that state into a growth phase (http://www.theage.com.au/victoria/regrets-only-a-few-20120928-26qme.html).

John went on further to recommend that a toll be placed on the Northern Freeway – which at the moment is one of the fastest growing corridors. His reasoning was that the businesses travelling to work in this locale would be the ones paying the toll and residents – wishing to avoid this fee – would be more likely to catch the train (which would mean that this transport system may in fact become sustainable).

Samantha thought that this was a brilliant concept – despite being somewhat radical.

But when she raised it with other colleagues, their first reaction was to state that they didn’t think they should be forced to donate $100 so that Ellenbrook could get the train.

This led Samantha to think – just when would we as ratepayers, start to believe and hence invest in our own state?

This “What’s in it for me” mentality is in fact preventing us as a State to bloom – but at the end of the day $2/ week is very little to give up, in order to gain so much.

Perth is definitely in a precarious position – destined to grow with the most recent infrastructure which has been created – but also facing potential failure if our mindset is not right.

What do you think – would you invest $100 a year to help Perth’s transport network grow?

PS the good news is that Mark McGowan announced the Federal financing commitment for Metronet in today’s press (http://www.perthnow.com.au/news/western-australia/23-billion-jobs-boost-for-wa/news-story/b53b044c6aa3848a4c809169a1ea7645)

Poll demonstrates support for apartments

The newly formed Western Australian Apartment Advocacy (WAAA) decided to conduct a poll at the Perth Royal Show last week, and the results clearly demonstrated an overwhelming 93% support for apartments.

WAAA Managing Director Samantha Reece randomly surveyed 300 people over the course of the eight day show, and not surprisingly the majority of people recognised that Perth could no longer sprawl further north or south.

It was the first poll of its kind in WA and respondents reflected a cross section of country as well as Perth based residents, all ages and genders. In addition,of the 300 surveyed, only 12% of these were apartment owners.

Regardless of the respondent mix, the poll has however demonstrated that the majority of people believe apartments play a role within Perth and WA.

Of the 7% that did oppose apartments, this tended to be driven by misconceptions that they would end up as slums, reduce neighbouring house values or even erode the community spirit.

In conjunction, some additional verbatim comments also provided an insight into buyers desires.

Young families said that they would purchase an apartment if there was a playground/community garden at the ground level.

While older male respondents also indicated that they would like a Men’s Shed or a place where they could tinker with their tools.

Certainly having apartments near a supermarket and also transport rated highly. But by far the strata fees and prohibitive cost of apartments were a major stumbling block for some potential buyers.

However what this feedback does tend to demonstrate is that apartment designs now need to break the mould of just one and two bedroom configurations.

For some time now, apartments have only meet a small portion of the market (young couples and downsizers) but we are now seeing a growing appetite for apartments being driven by families as well.

From this feedback it is quite clear that the inclusion of gyms, saunas, entertainment rooms etc now needs to be rethought, in order to provide some added variety.

WAAA was commenced by Ms Reece in September, to provide a voice for apartment dwellers as well as those people who support apartments.

Its catalyst was the growing number of small vocal minority groups, who were opposing apartments, regardless of the context.

The WAAA is now seeking to add more balance to the dialogue about housing choice.

If you would like to join the discussion about apartments in WA log onto http://www.waaa.net.au and register.

WA Apartment Advocacy provides balance

Long term property commentator Samantha Reece has launched this week the WA Apartment Advocacy (WAAA) to generate open discussion about the role of apartments within the state.

Motivated by the sway of NIMBYism (Not in my back yard) that tended to dominate Council decisions, Samantha has taken the bold move to enlist the support of apartment livers (people who own and live in apartments) to ensure that there is a more balanced discussion.

“When I witnessed Councils changing Town Planning Schemes and rejecting apartment projects based on what I call, 0.0006% of the population, I decided that something had to change,” Ms Reece said.

“I know for a fact that there are people who love their apartment and would like more choice but they are being hamstrung by people who would prefer to maintain the status quo.

“There have been mandates from State Government for Councils to nominate areas where apartments are a good fit and that is ideally around train stations, retail and on major roads.

“If people speak up about the fact that they want to see more choice then maybe the Councils and Government will have the confidence to make bold decisions, which reflect the needs of their entire community.”

The WAAA is encouraging people to register on their website www.waaa.net.au so that their ideas can be shared with decision makers.

“I have had young people state that they would like to see smaller apartments introduced into Perth, because all they really need is a place to sleep.” Ms Reece said.

“On the other hand I have had families ask why we don’t offer four bedroom and two bathroom apartments like we see in Singapore.

“This is the kind of information that needs to be brought to light so that planning decisions provide real choice.”

Sean Morrison is one of those young people who recently purchased an apartment by NIB Stadium.

“I have exchanged a one hour drive into the City each day for a 20 minute leisurely stroll to work,” Mr Morrison said.

“I literally fill my car just twice a month and that for me is both sustainable and cost effective.

“Because of the reduced travel time I believe I am more productive at work and I also have more free time to enjoy. It is this quality of life that I really appreciate.”

A new look at the Mandurah Train Line TODs … the apartment living options

Those of you who have been following the PropertyESP blog for a while know that we have an appetite for TODs (transit-oriented developments) because of their economic impact.

So we decided to take a look at two TODs on the Mandurah train line, in Cockburn Central and in Wellard.

Wellard is the site of Perth’s first Mandurah line TOD, but like nearby suburbs it started with a focus on houses.

The Cockburn Central TOD however was established with apartments and home units in mind, and the first home units came onto the market in 2008. Wellard followed suit with its first units sold in 2012.

Home units are the more popular accounting for 72% of the units sold from 2008 onwards. The bulk of the other options were apartment houses.

What’s the difference between the two? Home units are completely self-contained and a better standard than flats (which are rarely built these days).

Apartment houses on the other hand, are considered more luxurious and have more amenities.

Two bedroom apartments and home units dominate the Cockburn Central and Wellard TODs… with 40% of sales since 2008 being of 2 bed-2 bath-1 car park and 25% being 2 bed-1 bath-1 car park. 17% were 1 bed apartments and home units.

The dominance of the single car park is a reflection of the property being close to the train line, with good access to the City, but may not reflect the reality of living 10-14km from the beach. In fact, more than 80% of the properties sold had room for only one car.

But with more train stations coming online, we can expect to see more TODs and more developments that will take full advantage of these transit links.

If you are interested in the full results of the sales analysis for Wellard and Cockburn then feel free to contact Samantha Reece on 0452 067 117.

PropertyESP we make sense of property.