Housing shortage hits new low in December

10 January 2023

"Listings for sale and rent hit 12-year lows at the end of December 2022, according to reiwa.com data. "

Listings for sale and rent hit 12-year lows at the end of December 2022, according to reiwa.com data.

The number of properties for sale dropped to 6,931 at the end of the month. The last time they were this low was August 2010, when there were 6,858 listings.

“While listings traditionally decline at this time of year, they are 10.8 per cent lower than December 2021, when market conditions were similar and listings were already low,” REIWA CEO Cath Hart said.

“Delays in the building industry and population growth contributed to low listing levels in 2022. Now there is also hesitancy around interest rates.

“While our members are reporting they have sellers who are planning to list in January, we do not expect listings to rise significantly while interest rate uncertainty remains.”

The number of properties for rent on reiwa.com was 1,443 at the end of December, which was 22 per cent lower than the 1,870 reported at the end of November and 23.1 per cent less than the same time in 2021.

“Rental listings also usually experience a seasonal decline, but we haven’t seen numbers this low since early November 2010 when there were 1,415 properties available for rent on reiwa.com,” Ms Hart said.

“It’s been very challenging for tenants but there are some positive signs for the year ahead.

“After seeing investors leaving the market in the past two years, with more than 18,000 fewer rentals now since the peak in January 2021, bond data shows the decline has eased and the number of rentals in WA has been fairly stable since October.

“Our members are also reporting increasing interest, particularly from Eastern States investors who see value in WA’s house prices and the potential for strong rental returns.

“This is a positive indication in regard to boosting rental stock levels but it will take some time for this to flow on to tenants.”

While the number of properties for sale and rent are at similar levels to 2010, WA’s population has grown since then.

According to the Australian Bureau of Statistics, in June 2010 WA’s population was 2,290,845, most of which was in the Greater Perth region. The population grew 22 per cent to 2,785,312 by June 2022.

Ms Hart said population growth would continue to put pressure on the market.

CoreLogic home value index

CoreLogic’s Perth home value index increased slightly in December, up 0.1 per cent from November and 3.6 per cent over the year.

All other capital cities saw declines from November to December.

Ms Hart said Perth values were holding steady, which was good news for buyers and sellers.

“Stability is good news for all parties,” she said.

“Buyers, who have had eight interest rate rises affect their borrowing capacity, don’t have the added burden of significant price rises, while sellers are seeing the value of their property maintained.”

The top performing suburbs for house price growth in December were Applecross (up 4.9 per cent to $1,800,000), Gwelup (up 4.2 per cent to $1,135,000), Balcatta (up 3.1. per cent to $570,000), South Yunderup (up 2.8 per cent to $533,000), Wembley (up 2.8 per cent to $1,487,000) and Bicton (up 2.2 per cent to $1,380,000).

The other suburbs to record moderate house price growth were Fremantle, Hammond Park, Rockingham and South Perth.

Time on market

Properties continued to sell quickly in December, taking a median of 17 days to sell. This was one day slower than November, but unchanged from three months and a year ago.

reiwa.com data revealed the fastest selling suburbs in December were Orelia (six days); Leda, Greenfields and Gwelup (seven days); Harrisdale, Erskine and Parmelia (eight days) and Meadow Springs, Baldivis and Banksia Grove (nine days).

“With the exception of Gwelup and Harrisdale, the 10 fastest selling suburbs for December had median house prices below $500,000,” Ms Hart said.

“There is a lot of activity in the more affordable price brackets, which suggests buyers are becoming more price sensitive, factoring in future interest rate rises and buying quickly when they see value.”

Perth rental market

Median rent price

Perth’s median rent price was $520 per week for December, which was $20 higher than November and up $70 on December 2021.

“The demand for the limited number of rental properties available continues to put pressure on prices,” Ms Hart said.

“Population growth will maintain demand and we do not expect prices to fall in the short term.”

Median leasing times

It took a median of 15 days to lease a rental during December, one day more than November, but the same as three months ago.

Suburbs recording the fastest median leasing times were Harrisdale (eight days); Balcatta, Cannington, Joondanna, Success, Thornlie and Yokine (nine days); and Ascot, Atwell and Bentley (10 days).