Perth home values up 10 per cent in last 10 months

The Perth residential sales market continued its growth trajectory for a tenth consecutive month in May, with the Core Logic Perth home value index increasing 1.1 per cent during the month.

REIWA President Damian Collins said that brought Perth price growth to seven per cent for the first five months of the 2021 calendar year and 10 per cent since July 2020.

Median house sale price

Perth’s median house sale price for May was $510,000, with reiwa.com data revealing 81 suburbs recorded house sale price growth during the month.

“The top performers were Attadale (up 4.9 per cent to $1.25 million), Scarborough (up 3.8 per cent to $755,0000), Melville (up 3.6 per cent to $860,000), South Lake (up 3.6 per cent to $400,000) and Hamilton Hill (up 3.5 per cent to $490,000),” Mr Collins said.

“Nedlands, Atwell, Craigie, Floreat and Bicton also performed well.”

Median selling days

Competition among Perth buyers remains high, with the median time to sell sitting at 14 days for May.

“Median selling times are still sitting close to 15-year lows, with buyers needing to act very quickly to secure a property,” Mr Collins said.

Listings for sale

There were 9,020 properties for sale in Perth at the end of May on reiwa.com.

“This is 0.8 per cent more than there were at the end of April and 14.9 per cent more than three months ago. The figure for May is also the first time we have seen listings sit above 9,000 since November 2020,” Mr Collins said.

“Given the buoyancy of the Perth sales market, more and more people are recognising that there is good opportunity to sell their home for a competitive price which is leading to an increased number of properties on the market.”

Perth rental market

Listings for rent increased 3.8 per cent in May, while the Perth median rent price was stable during the month.

“While the rental market has some way to go before it balances out, the signs are encouraging that we are on the right track. Since the moratorium ended in March, we’ve seen investor activity start to build again, as evidenced by last month’s ABS investor finance figures, which is producing more rental stock and helping to slow down rental price growth,” Mr Collins said.

Listings for rent

“Not only are listings up 3.8 per cent for the month, but over the last three months we have seen rental listings increase 7.4 per cent, which is quite substantial after a long period of declines,” Mr Collins said.

The 10 suburbs to record the biggest increase in rental listings during the month were Kewdale, Balcatta, Maddington, Mount Pleasant, Como, Cloverdale, Yanchep, Mindarie, Forrestfield and Claremont.

Median rent price

Perth’s median rent price was unchanged in May, holding at $420 per week.

“This is only the second time this year that we’ve seen the median rent price remain unchanged. The increase in listing volumes coupled with stable rents suggests the challenging market conditions facing tenants are beginning to ease,” Mr Collins said.

While the overall median rent price was unchanged during the month, 29 suburbs did record price increases.

“The strongest performers for median rent price growth during May were Alkimos (up $15 to $375 per week), Halls Head (up $15 to $390 per week), Gosnells (up $10 to $320 per week), Rockingham (up $10 to $350 per week) and Nollamara (up $10 to $360 per week),” Mr Collins said.

Leasing activity and median leasing times

There were 2,891 properties leased during May, which is four per cent more than April.

“The suburbs to record the biggest increase in leasing activity during the month were Secret Harbour (up 78 per cent), Piara Waters (up 60 per cent), Halls Head (up 57 per cent), Clarkson (up 55 per cent) and Wellard (up 43 per cent),” Mr Collins said.

reiwa.com data shows the median time to lease a property in May was 18 days.

“The median time to lease a property has been relatively stable since September 2020, hovering between 17 and 19 days. On an annual basis however, property investors are finding tenants for their rentals nine days quicker than they were this time last year.”

For more local market information, visit the WA market page.

SOURCE: Reiwa.com

Why the private rental sector is crucial to a healthy rental market

The importance of individual property investors in a healthy, thriving rental market is frequently overlooked.  

Some people suggest that investors are wealthy individuals hoarding large numbers of properties. This is simply untrue. The research shows that mums and dads (with less than two rentals) are the most common investors and that they utilise property investment to help secure their future. 

They also provide an invaluable service to the community – supplying housing for tenants. Governments and their state-funded housing simply cannot do this job alone. 

Without investors, tenants suffer

Property investors and the private rental market are essential to ensuring tenants can find appropriate housing. Without investors, tenants suffer through higher rents and fewer properties. 

The more property investors there are in the market, the more available rental stock there will be, the less competition tenants will face and the easier it will be to secure housing. 

The last eight months have been challenging for the Western Australian rental market, which has faced low levels of investor activity, a shortage of rental stock, record low vacancy rates and high demand from tenants. 

Positive trends on the horizon

Pleasingly, there are now signs investors are returning to market. In early May, the Australian Bureau of Statistics (ABS) released data showing investor finance in WA had surged to a five year high of $462 million in March 2021, which was up from $237 million in March 2020.  

While we remain some way off the $1 billion figure WA experienced during 2014, this is still a positive trend and one we need to continue to achieve a balanced market. 

reiwa.com data for May supported the ABS findings too, with listings for rent up 3.8 per cent in May and 7.4 per cent over the last three months. This is an encouraging trend in light of the ABS figures.

With activity from investors on the rise, we should hopefully see a continued increase in the number of listings come to market in the coming months, which will go some way towards easing the state’s rental shortage. 

Looking ahead

Moving forward, we need to ensure the outcomes of the upcoming Residential Tenancies Act review are fair and equitable for all parties, so that property investment isn’t discouraged and there is enough available housing stock in the private rental market to keep up with tenant demand.  

Thinking of investing in property? Start your search today. 

SOURCE: Reiwa.com.au

WA still the most affordable state for housing and rentals

Despite strong market conditions, Western Australia is still the most affordable state for housing and rentals, according to the Real Estate Institute of Australia’s (REIA) latest Housing Affordability Report.

The report found that the proportion of family income needed to meet loan repayments in WA during the March 2021 quarter was 24.8 per cent, while the proportion of family income needed to meet rent payments was 18.7 per cent.

REIWA President Damian Collins said rental affordability in WA was the best of any state or territory in the country. Housing purchase affordability was also amongst the best, with only the Northern Territory and Australian Capital Territory more affordable than WA.

“Despite the WA property market being firmly in a recovery phase, WA buyers and tenants enjoy the most affordable prices of any other state in the country.

“To put the WA figures into perspective, in New South Wales, the proportion of income needed to meet repayments for housing was 43.5 per cent during the March quarter, while the proportion of income needed to meet rent payments was 28.6 per cent.

“That is significantly more than WA and highlights that despite the buoyant market conditions, WA buyers and tenants remain in a favourable position when it comes to affordability.

“The findings of this report are further evidence that the biggest issue facing WA right now is not affordability – but the shortage of available properties to buy and rent. Thankfully, with listings for sale up 14.9 per cent during the last three months and listings for rent up 7.4 per cent during that same time frame, we are starting to see some light at the end of the tunnel.

“While there is no question that for some people in WA access to affordable housing is still out of reach, it is pleasing that for most people, WA remains a very affordable place to live,” Mr Collins said. 

More information

For more information about the findings of the REIA Housing Affordability Report, view their official media release. 

SOURCE: Reiwa.com.au