According to the Real Estate Institute of Western Australia (REIWA), the September quarter was a tough one for Perth, with the city continuing to suffer in a number of areas.
The September quarter saw both the median price for houses and units take a backward step.
“The median house price for the September quarter came in at $522,133, an adjustment of 4.2% on the revised June quarter median of $545,000, while units and apartments edged back 2.3% to $420,125 from the revised June quarter figure of $430,000,” REIWA president Hayden Groves said.
The fall in prices hasn’t prevented people from taking their properties to market, with the REIWA figures showing listings are currently at levels not seen since the aftermath of the GFC.
That level of stock on market has meant the Perth market has swung in favour of buyers, which has resulted in properties taking longer to sell.
“With these stock levels of property available in Perth, prospective buyers considering a purchase in the WA property market are under less pressure,” Groves said.
“The average number of selling days for the Perth metro region is now at 62 days, which is up five days on the June quarter, while 53% of vendors needed to discount their asking price in order to sell,” he said.
Not surprisingly, those figures coincide with a drop in the number of sale across the state for the September quarter.
“We estimate that total dwelling sales for the quarter will come in at around 8,600 sales across WA, below the average and fewer than the June quarter, although the winter months normally return a subdued sales volume measure,” Groves said.
While the REIWA figures may not paint the rosiest of pictures for Perth, Liz Sterzel, buyer’s agent with Perth based agency Property Wizards said there is some interest from buyers looking to take advantage of the softer conditions.
“We have seen an increase in enquiries from potential buyers in recent weeks looking to take advantage of the quieter market,” Sterzel said.
“In a market like this, with a large number of properties available, buyers can take their time and assess all their options to find a property that ticks the right investment boxes,” she said.
While there may be some bargains available, Sterzer said investors do have to realise they won’t be getting the same returns as seen in the past.
“Rents have risen a lot in recent years and this slowing is a natural part of the rental cycle so investors need to allow for the ups and do the best they can in the down cycles,” she said.
“To minimise vacancies, investors will need to keep their properties in tip top shape, and may also need to consider lowering the rent to appeal to tenants.
“It’s more important to get a good tenant in at a lower price than hold out for higher, potentially unattainable rents for an extended period.”
While Perth’s market is experiencing a period of volatility now, Sterzer did say there are signs that it could settle in the near future.
“While population growth has slowed, Perth is still continuing to grow at the fastest rate of all the capital cities.
“People are continuing to be drawn here by the employment opportunities and lifestyle on offer, and this has helped stabilize the rental stock, with the median rent for housing having remained steady at $420 per week for several months.”