Perth Housing Prices Remain Steady
When the interest rate began rising in May, ripples of concern regarding what might happen next pulsed throughout the nation. With the new rates came rising mortgage payments, a phenomenon nearly a million borrowers had never experienced.
Looking back on the rate hikes, it is apparent that the Perth housing market had a measured response to the new rates, without dynamic changes seen in other capital cities. Now, several months into the changes, indicators show that Perth is weathering the changes better than any other capital city.
Good News in Western Australia According to Real Estate
Institute of Western Australia CEO Cath Hart, “The increases have added $760 per month to a $500,000 mortgage since May, while those on a mortgage of $1 million have seen repayments increase $1,520 per month. Rising interest rates have clearly (significantly) impacted prices and borrowing capacity in the Eastern States.”
The strong economy in Western Australia plays a significant role in keeping the housing market stable. At the end of November, the RBA noted there were more advertisements for workers than active job-seekers in Western Australia. The state’s economy is among the strongest in the world. Additionally, Perth is the most affordable capital city. All of which translates into an excellent climate for stability across housing markets.
Many suburbs showed nominal growth through the end of November. This includes:
- Bentley (up 3.1 per cent to $500,000)
- Subiaco (up 2.1 per cent to $1,675,000)
- Bayswater (up 2.1 per cent to $720,000)
- Dawesville (up 2.0 per cent to $520,000)
- Falcon (up 1.9 per cent to $453,500)
Other suburbs that showed price increases during the same period included Sorrento, Parmelia, Kelmscott, Heathridge and Tapping.
Other Notable Factors in the Western Australian Housing Market
Homes Listed for Sale – At the end of November, there was a 5.8 per cent increase in the number of homes listed, making the number 8,642.
The building industry’s frequent delays trimmed the number of properties listed. Those building new homes are hesitant to list their current homes until work is underway on their future dwelling. This decision not to list limits the choices of potential home buyers, who, in turn, hold off on making their property available.
Time Spent on the Market – During the same time, sellers enjoyed a phenomenal turnaround. The median time to sell a home was 15 days—homes in many areas sold in considerably less time.
- East Cannington (four days)
- Meadow Springs (five days)
- Orelia, Mount Lawley, Cooloongup and Golden Bay (six days)
- Parmelia, Beeliar, Bayswater and Butler (eight days)
Perth’s Rental Market
There has been a notable shortage of rental units in Perth for some time. One factor contributing to the deficit is the uptick in interstate and overseas migration. Both of these areas are expanding at a rate unseen for a decade.
At the same time, listings have been down by 20.5 per cent since a year ago. These factors, along with many owners of rental properties either selling to take advantage of the market or moving into their rental properties, contribute significantly to the housing shortage and the speed of rentals.
Median Leasing Time – On average, it took 14 days to lease a rental unit in Perth’s suburbs. However, just as in the housing market, there were several areas in which units were snapped up much faster.
- Byford (seven days)
- Meadow Springs, Seville Grove and Innaloo (eight days)
- Canning Vale, Tuart Hill, Duncraig and Yanchep (nine days)
- Mosman Park and Balga (10 days)
Rental Prices – The median price of a Perth suburban rental was $500 per week. There is no indication that rental prices for Perth suburbs will decrease until the rental shortage eases. Of course, the rental shortage is tied to the building industries’ woes. At the same time, the outlook is far from bleak. These several facets of the industry must be ironed out to achieve optimal conditions.
To find out more about the impacts of rate increases or to learn how we can assist you in buying, selling, or leasing property in Western Australia, feel free to contact Zest Realty. Our expert team will walk with you on your real estate journey.
