According to Herron Todd White, a leading valuer in Australia based in the eastern state, it has been reported that the capital city of WA, Perth has reached the peak of its property cycle. Residex has reported Perth as having the highest median property price in the whole of Australia, even more than Sydney.

Industry professionals said the main reason for the property boom in WA is mainly attributed to the resource boom. People flocked to WA for employment in droves and the supply of properties is not enough to keep up to the ever-growing demand.

The question is how long will this resource boom last? Judging by recent reports where Australia has just made a pact with China, it is going to last for a while. Housing affordability index cannot be rising forever. It will grow to a point where people deem it is not viable to buy properties at a certain price as the wages just cannot support the mortgage repayments.

When the resource boom is over, people might leave town in droves. This may create a temporary situation of oversupply in WA and it may be undesirable for many property investors.

For investors who have already invested in WA and had equity in their investment property, they may look towards the eastern states and capital cities for re-investment. Don’t get me wrong. I am not advising the investors to sell. All you need to do is to consult a mortgage broker or an investment specialist, they will advise investors how to uplift equity in their existing portfolio to increase their total asset holdings without much risk.

For investors who are thinking about buying into WA, it may be worthwhile to look at properties that are settling soon or house/land packages. If you are buying off the plans, good luck to you. Pray that the numbers still stack up at settlement, or better still, pray that the developers have enough margins to continue with the sale. I have heard of developers putting viability clause in WA projects in such a way that if they deem the project is not viable anymore, they can cancel the contracts or go back to investors to ask for more money.

So look to the east mates. The chances of going wrong may be lessened!