MENU

Property prices up in major mining towns

The Esplanade Hotel, Port Hedland WA

There’s been a bit of talk about Australia’s plunging property market.

Major centres Melbourne and Sydney have been dominating the headlines as figures suggest the house prices in the country’s two biggest cities are dropping by about $1000 a week.

Across the country, the story doesn’t appear much better, at first glance.

A recent article by Domain Holdings Australia Ltd (ASX: DHG) draws upon figures which suggest 8.9% of Australians with home loans are experiencing negative equity.

The situation looks particularly dire in Western Australia where it’s understood that 16.5% of mortgage holders are dealing with negative equity.

As such, recent interest rate rises by major banks including Australia and New Zealand Banking Group (ASX: ANZ), Commonwealth Bank of Australia (ASX: CBA) and Westpac Banking Corp (ASX: WBC) will likely only add to the pressure already felt by many.

However, away from those east coast hubs and major centres, far away, in north Western Australia, there’s a different story.

The Pilbara region, home to major mining operations of some of Australia’s biggest companies, including BHP Billiton Limited (ASX: BHP), Rio Tinto Limited (ASX: RIO), Fortescue Metals Group Limited (ASX: FMG), was touted as the ‘engine room of Australia’s economy’ during the country’s latest resources boom.

Then came the bust.

Port Hedland’s property prices copped a beating amid a mining downturn, with the median house price falling from $1 million in 2014 to $342,500 in 2017, according to the Real Estate Institute of Western Australia (REIWA).

Karratha’s property prices suffered, too; the median unit price dropped from $800,000 in 2014 to $132,500 in 2017, according to REIWA.

While those staggering losses may paint a fairly dismal picture, it appears there is hope.

Port Hedland’s median house price has risen by 28.5% in past year to $440,000 while Karratha’s median unit price has also edged up to $139,000, according to REIWA.

Does this mean the ‘engine room of Australia’s economy’ is starting to fire up again?

Top 3 ASX Blue Chips To Buy In 2018

For many, blue chip stocks mean stability, profitability and regular dividends, often fully franked..

But knowing which blue chips to buy, and when, can be fraught with danger.

The Motley Fool’s in-house analyst team has poured over thousands of hours worth of proprietary research to bring you the names of "The Motley Fool’s Top 3 Blue Chip Stocks for 2018."

Each one pays a fully franked dividend. Each one has not only grown its profits, but has also grown its dividend. One increased it by a whopping 33%, while another trades on a grossed up (fully franked) dividend yield of almost 7%.

The names of these Top 3 ASX Blue Chips are included in this specially prepared free report. But you will have to hurry. Depending on demand – and how quickly the share prices of these companies moves – we may be forced to remove this report.

Click here to claim your free report.

Motley Fool contributor Steve Holland has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Two New Stock Picks Every Month!

Not to alarm you, but you’re about to miss a very important event! Chief Investment Advisor Scott Phillips and his team at Motley Fool Share Advisor are about to reveal their latest official stock recommendation. The premium “buy alert” will be unveiled to members and you can be among the first to act on the tip.

Don’t let this opportunity pass you by – this is your chance to get in early!

Simply enter your email now to find out how you can get instant access.

By clicking this button, you agree to our Terms of Service and Privacy Policy. We will use your email address only to keep you informed about updates to our website and about other products and services we think might interest you. You can unsubscribe from Take Stock at anytime. Please refer to our Financial Services Guide (FSG) for more information.