by Michael Forzatti
No one has been immune to an erosion of the value of their home or investment over the last few years. The market correction in the current real estate cycle has affected all of us. Some in more serious ways than others, but each household to some degree. There’s a silver lining in all this that’s been there from the beginning and isn’t going anywhere.
My father reinforced some thoughts I’d had recently when he said, “Michael, we need to return to a longer-term view of the market. Not one where you think you’ll flip around a property in a couple of years with a quick lick of paint and an Ikea kitchen and hope to make a big gain, but with a view to sinking deep roots into the place you call home.”
What Dad was saying was “change the way you’re thinking about the market and the way you’ll look at your situation is going to change as well”.
I tend to agree with him on this one.
We had an unsustainable era in the Perth market ten years back, but we’re in a different economic climate right now. Perhaps we began to think that was normal. It wasn’t; it was an enormous boom. We may see its like again; we may not.
Being fixated on median prices and capital growth rates right now is likely to leave you feeling more pessimistic than optimistic. It’s information worth being aware of, but not information worth fixing upon.
Yes, property values have gone down across the board in Perth. If you seriously want to realise your loss quickly, go for it. If you have no intention of selling, why be preoccupied with what’s happened to the value of your home in the last three years?
The traditional (some might say ‘old-fashioned’) approach was that you buy into an area for its lifestyle benefits. The quality of its schools, the abundance of recreational benefits, its convenience to work, transport links, and the community spirit of the neighborhood.
When developers bought large parcels of land in areas like Baldivis in the seventies and eighties, they weren’t thinking about how much they’d make in the next four or five years, but the next forty or fifty.
If you live in and around 6157, you’re in a great neighbourhood. That’s worth thinking over. It’s not all about making money, it’s about the qualities of a community, the sweetness of a lifestyle, and building something substantial over the slow turning of time.
So what are you buying? What did you buy? What price do you put on that sort of lifestyle? On having parks on most corners? On happy kids in quality schools?
In having rivers, beaches, and Fremantle just a few minutes away? Those things don’t change with a market downturn, they’re just the same.
I’ll admit I’m parochial, but I’ll take the lifestyle of 6157 any day over what I’ll find in a greenfields development 45-60 minutes away! They may be able to tell a similar story to ours at some point, but it’s probably many years away!
I don’t want to play the comparison game, but I do want to say, 6157 is a brilliant postcode in which to live. Palmyra and Bicton is a great place to have a home and raise a family.
Now is a time, as mums and dads and families, to go ‘head down-bum up.’ To knuckle down and put in the hard yards. To work at getting balance in your lifestyle and enjoying the rich fabric of the community that we’re privileged to call ‘home.’
This isn’t grim thinking; it’s glass-half-full thinking. Look around you and enjoy what you have right now. Make a list if it makes sense to you and, for the moment, perhaps leave dollar figures off the list. They’ll find there way back on there soon enough.
For now, look around you.
Look up and down your street.
Take a walk! Count your blessings!