The latest sales figures reveal a trend towards recovery, while the rental market tightens up in Perth
While big markets like Melbourne and Sydney are starting to fall back in terms of settled sales, the once-flailing market of Perth is beginning to build itself back up.
According to Shane Kempton, COO of Professionals Real Estate WA and NT, the cities of Melbourne, Sydney and Brisbane all recorded drops in the number of settled sales over March 2018. By contrast, this figure rose in Perth.
“Sales volume trends are generally a good forward indicator of the property market in a specific market, and this trend is now on an upward trajectory in Perth,” Kempton says.
This is in part due to Perth’s affordability as a result of the last several years of downslide. Interested buyers on a budget have come in to capitalise on the low prices now that the market seems to have bottomed out.
Professionals has also found that the rental market is tightening both in Perth and Darwin, which will lead to higher rents.
“These higher rents will also encourage more people who are currently renting in these two cities to consider buying a home, especially with interest rates now at record lows,” Kempton says.
Damien Lee, head of acquisitions at Caifu Property, says, “I like Perth as a city. I think there’s going to be more opportunity there. It’s a marketplace where you can trade in a little bit longer than places like Darwin or Canberra.” However, he does not see Perth as having significant value or growth prospects over the long term. “In a smaller market like Perth, you’re trading in and out based on what’s happening in that cycle.”
While the number of buyers is increasing in Perth, there is a lack of urgency in demand.
“There are active buyers out there, but there’s no urgency in the market. Apartments have started to see a slight increase in sales volumes (according to real estate agents), but that is most likely investor activity starting to pick up,” says OpenCorp director Matthew Lewison.
He believes a change in Perth’s status will be clear once owneroccupiers come in to snap up established houses.
“This will then feed into the new housing market; so the things to watch this year will be the middlering suburban sales results,” he advises. “Once these get going, the good-quality land estates will start to shift in higher volume, and that will lead to more construction work and improving confidence.”
SUBURB TO WATCH
COMO: Price declines ease
The large suburb of Como in South Perth is a highly accessible area that is well served by public transport. The Canning Bridge railway station and Canning Bridge bus station facilitate travel to the Perth CBD. Canning Highway also runs through the suburb.
The suburb is home to several schools, including Collier and Como Primary Schools, Como Secondary School and Penrhos College.
Median prices come in at a little over $750,000 and $500,000 for houses and units, respectively. These values have been falling steadily since 2015, although the decline has eased over the past 12 months. This could be a good sign that Perth is starting to finally bottom out and steady itself.
Education: The suburb is home to Collier and Como Primary Schools and Como Secondary College
Transport: Como is served by the Canning Bridge railway station and Canning Bridge bus station
Can you afford to buy in this suburb? Find out how much you can borrow
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