Perth is shaping up to be a bright spot for property investors who would like to expand their portfolios.
Momentum Wealth finance team leader Caylum Merrick said recent market indicators are pointing to a strong outlook for Perth.
“With Perth property values recording sustained growth over the past 12 months, many owners have benefitted from an uplift in equity in their property and are seeing this as an opportunity to review their financial position,” he said.
A recent report from CoreLogic showed an 18.1% annual increase in Perth’s dwelling prices.
This supports the findings of a recent study by the Real Estate Institute of Western Australia (REIWA), which showed a widespread recovery occurring across all price points.
In fact, the top 50 performing suburbs for median price growth over the year to September are composed of 21 suburbs in the lower end of the market, 16 in the middle, and 13 prime markets.
Bicton recorded the most robust price growth among Perth suburbs in the year to September, clocking a 35.7% gain that pushed its median price to $1.25m.
Astot and Claremont followed, posting respective gains of 30.7% and 30.6%.
Other suburbs that recorded stellar growths during the period include Salter Point (29.4%), Cottesloe (25.4%), Medina (24.9%), City Beach (24.1%), Wannanup (23.2%), North Beach (23.2%), and Stratton (23.1%).
Investors expanding their market share
Figures from the Australian Bureau of Statistics (ABS) showed investor loans grew by 86.35% annually in August 2021.
Mr Merrick said this reflects the increasing demand from investors, both existing and first-timers, who want to leverage on the increasing prices to fund an investment purchase while interest rates are at record lows.
“We have also witnessed similar growth in investor demand, with many investors recognising the unique opportunity at hand to capture both growth conditions and strong rental yields, with Perth continuing to offer some of the most competitive rental yields across the nation,” he said.
Mr Merrick said investors should take advantage not only of the current conditions in Perth market but also the anticipated growth.
“There’s no sign the current growth phase has run its course, with increased mining activity, widespread skills shortages and ongoing low levels of stock all favouring market growth,” he said.
“Investors who act now are likely to be in a stronger position to capture further increases in demand that will come with the easing of border restrictions.”
Photo by Nathan Hurst on Unsplash.