A mining region that once boasted rents of over $3,000 and asking prices hitting $1.5 million has continued to crash, says an industry commentator.
Speaking about Port Hedland, a mining town in the Pilbara region exposed to iron ore and gas, SQM Research managing director Louis Christopher said property investors in the region had recently experienced some value losses, but the worst may be over.
“Essentially, asking prices for houses have fallen from $1,500,000 down to $900,000. That’s a 40 per cent plummet,” he said.
“Naturally, that has been an appalling result for existing property investors.
“The rental situation has also been just as bad. Rents for houses briefly peaked at $3,200 a week. They are now down to $1,550 a week.”
Mr Christopher said despite the negative news, “vacancy rates in Port Hedland appear to have finally stabilised at six per cent”.
According to SQM, listings have also fallen in recent months.
Mr Christopher said there has been “bloodshed” in Port Hedland, but conceded the worst might be over.
On the other side of the country, Muswellbrook, a coal town that had the rather unpleasant news earlier last year of cancelled expansion projects, still appears to be taking a beating on the listings side, Mr Christopher said.
“After peaking at 14 per cent, vacancy rates have been falling and are back down to nine per cent.
“That still is a very, very high number but it is the relative movement that is just as important as the absolute number.
“Rents of course, have been pulverised but there is a hint at the very end of the chart of a possible bottoming out,” he added.
Down in South Australia, Olympic Dam is also showing some strong signs that the worst is over.
“After peaking at over 10 per cent, vacancies are falling very quickly,” Mr Christopher said.
“The town is now down to three per cent vacancies.
“Correspondingly, rents have bottomed out and are showing signs of an imminent recovery.”