While Western Australia is still recording a decline in property prices, the outlook for this state is positive
According to CoreLogic’s Home Value Index for July 2018, Perth is one of the capital cities driving national property prices down. In spite of these findings, Perth continues to push towards a recovery, with values an improvement on what they were in March.
“After declining during the March quarter, it’s pleasing to see prices rebound strongly this quarter. With the worst of the market downturn appearing over, the improvement in house and unit prices this quarter suggests buyer confidence is returning, which should bode well for sellers as we move into spring,” says Hayden Groves, president of the Real Estate Institute of WA.
The winter season contributed to a slowdown in Perth’s performance, but several suburbs have powered through, recording high volumes of sales. Standouts include North Perth and Queens Park for houses, and Balcatta and Claremont for units.
“The June 2018 quarter continued the trends observed during the December 2017 quarter, with good-quality family homes attracting a lot of attention in aspirational areas,” Groves says.
“As the WA economy begins to regain strength and owner-occupier loans remain the most affordable they have been in decades, buyers are recognising that there is good opportunity to secure a family home in areas that might previously have been considered out of reach.”
Listing down, returns up
Supply levels are also coming under control in Perth, which is likely helping the market to regain its footing. CoreLogic’s Property Pulse report notes that the number of new listings in July 2018 was 1% lower than the previous year. Rental returns are also on the up, according to its July 2018 Total Returns Index, which indicates that total returns in Perth increased to 1.6% from 2017’s 1.2%.
In suburbs like Wembley, Ardross and Floreat, demand may even be outpacing supply, says Jeremy Sheppard of Empower Wealth.
“Wembley has a ripple effect potential of over 20% per kilometre, which is extremely high. Eighty per cent of all Ardross houses have open inspections, which indicates interest is high. Floreat houses have a 75% auction clearance rate, which is typical for markets experiencing strong demand. If countercyclical buying is your strategy, aim high in Perth right now,” Sheppard says.
SUBURB TO WATCH
BECKENHAM: Units steady as house prices fall
A suburb of many names, Beckenham was previously called Buckingham and also once known as Waverley. It now boasts an affordable property market that is looking to find its footing in Perth’s recovering market.
Houses recorded a 5.4% price drop in the 12 months to July 2018, but the unit market turned things around with a slight increase of 0.2%, taking the median value to $360,190. Rents fell by 5.1% to a rate of $270 per week.
The Canning River runs along the southern fringe of this suburb. Beckenham Primary School is situated on Railway Parade, and the Mills Park Centre is a large community centre offering activity rooms, picnic and barbecue facilities, a playground and a cafe.
Amenities: A primary school and large community centre are a plus for families
Affordability: Median values of houses and units are both under $400k
Can you afford to buy in this suburb? Find out how much you can borrow
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