Recovery is at hand for Perth as property values begin to stabilise in many parts of the state
Perth’s market is still crippled, but pockets of the state are beginning to return to pre-boom levels.
“This marketplace continues to show signs of improvement. Vacancy rates have begun to fall and have remained in the mid-7% bracket for some weeks now, which compares to recent times when they were consistently over 10%,” reports Charles Tarbey, chairman and owner of Century 21 Australasia.
“The state economy is also showing signs of growth again, so I remain of the view that WA is an area investors should be looking at very closely.”
This development is in line with the WA government’s initiative focusing on job creation, to rebuild confidence in the state following the mining crash. The government predicts that the economy will bottom out this year, with growth expected to start heading up again in 2018.
This is attributed in large part to the gradual transition of Perth’s top industry from mining to exports, with the latter anticipated to be the top growth driver for the state in the next few years. Business investment is also forecast to be a contributor, generating more employment opportunities. Wage growth should remain low, but in the next couple of years this could turn around as the WA economy stabilises further.
Good news spreads to property market
Perth’s slow uptick is a welcome relief for WA property agents. Premium suburbs are attracting attention once more, and tenants are filling the vacancies in rentals. In addition, auctions are becoming more active as buyers start capitalising on the bottoming out of the market.
“Over the coming six months we should see an increase in buyer activity as continued positive news about the state economy strengthens consumer confidence,” says Travis Coleman, CEO of ACTON.
“All these data point to the fact that now is a great time to buy property in WA before the recovery in the economy and the property market gains further momentum.”
Real Estate Institute of WA president Hayden Groves confirms that median house prices and rental rates held steady leading up to the August 2017 quarter. Supply levels are also tempering as the number of dwellings on the market decreased by 10% in the same period – this could contribute to growth as demand goes up in the warmer months.
“The Perth property market is showing positive signs as we head into spring and summer,” Groves concludes.
SUBURB TO WATCH
COOLBELLUP: House prices take a tumble
Named after the Aboriginal terms for North Lake, the suburb of Coolbellup struggles to maintain demand for its houses.
Values fell by over 10% in the 12 months to August 2017 to a median price of $437,233. This continues a downward trend observed over the past three years. By contrast, apartments are inching upwards a little – values rose by 1.8% in the same period.
Investors can get an average yield of 4.2% in Coolbellup, so units may be worth keeping an eye on here. There are a wealth of amenities in the suburb, including a shopping centre and numerous parks. Len Packham Reserve is the place to be for soccer, basketball and skateboarding.
Amenities: Coolbellup has a skate park, sports facilities, a library and a shopping centre
Affordability: Prices are quite low considering the suburb’s proximity to Perth
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