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  • Perth property market slow but steady

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    photo-south-perth-freeway-sunny-dayPerth’s property market was impacted by seasonal influences in the three months to December, but when compared to the year prior results reflected trends seen throughout 2015.

    REIWA President Hayden Groves said the latest preliminary data for the December quarter demonstrated the expected impact the Christmas and New Year period traditionally has on the property market.

    “It’s not uncommon to see a fluctuation in the market at this time of year as it is typically a quieter time in WA real estate. Properties come off the market over the holidays and sales tend to drop off. We get a much clearer picture of how the market is travelling when comparing the data to the December 2014 quarter,” Mr Groves said.

    Houses and units

    Perth’s preliminary median house price came in at $530,000 for the three months to December 2015.

    “This is down 0.2 per cent on the revised September 2015 quarterly median and down five per cent when compared to the December 2014 median, however on an annual basis for the year to December 2015 Perth’s median house price held firm dipping just 1.8 per cent,” Mr Groves said.

    The median price for units in Perth lifted 1.2 per cent to $435,000 over the quarter, but had eased off 2.2 per cent on the December 2014 quarterly median price.

    Mr Groves said further analysis of the data showed that 35 per cent of all house sales in the Perth metro area occurred in the $360,000 to $500,000 price range.

    “This shows us that first home buyers are still very active and recognise that there is an opportunity in the current market to take the step into home ownership,” Mr Groves said.

    Sales volumes in the $500,000 to $750,000 price range weren’t far behind, making up 32 per cent of total sales volumes in the December 2015 quarter.

    Mr Groves said activity in this bracket tended to be from current home owners who wanted to upgrade to their next home.

    Listings

    Perth property market slow but steady - reiwa.comListings for sale dropped 3.8 per cent to 14,551 in the December quarter, following a peak of 16,969 in November.

    “It’s not uncommon for listings to drop off at this time of year as traditionally properties are taken off the market around the holiday period before returning to normal levels in the New Year.

    “When we compare this figure to the December 2014 quarter we see, as was the case throughout 2015, listings are still higher than the long term average,” Mr Groves said.

    Sales volumes

    Sales volumes for the three months to December are currently sitting at 5,909, down from 9,176 in the September 2015 quarter.

    “We estimate that once all sales have settled in the coming months the total number of dwelling sales in WA will come in at around 6,500 for the quarter,” Mr Groves said.

    Selling days and discounting

    Average selling days in the Perth metro area came down to 59 days in the December quarter.

    “This is three days less than in the September 2015 quarter, but still 13 days more than in the December 2014 quarter.

    “Additionally, 47 per cent of vendors needed to discount their asking price in order to sell in the December quarter, which is an improvement on the September quarter but higher than for the three months to December 2014,” Mr Groves said.

    Regional WA

    Results were mixed across regional WA, with regions in the state’s north continuing to adjust, while those in the south were generally more stable.

    Top performers in the quarter were Augusta-Margaret River with 6.5 per cent growth to its annual median house price, followed by Blackwood with a more modest increase of 0.7 per cent.

    Mr Groves said the North West sub-region was still feeling the impact of the shift to production in the mining sector, with annual growth in the Kimberley and Pilbara regions declining 3.6 per cent and 26.6 per cent respectively.

    Perth property market slow but steady - reiwa.com“These areas are experiencing an adjustment as construction slowed down significantly in a short period of time changing the employment requirements. However, when we look at the longer term growth rates for these areas we can see they have declined at a much slower rate,” Mr Groves said.

    Rental market

    Perth’s overall median rent price came in at $400 per week for the three months to December, breaking down to $410 for houses and $380 for units.

    Mr Groves said the overall median was steady on the September quarter median, but had dropped $40 on the December 2014 quarter.

    Rental listings increased to 9,532 in December from 8,267 in September, while the vacancy rate etched up to six per cent.

    Mr Groves said investors were being presented with some short term challenges, but that Perth tenants were in a great position to secure a lease at a more affordable price.

    “Migrations trends have changed rapidly in WA over the last six months and housing supply has increased. This has caused demand for rental housing to lessen putting downward pressure on prices.

    “The property market is cyclical and long term the projected population growth in WA is still expected to continue which will soak up stock and even out the imbalance we’re seeing,” he said.