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WA Property Market Update May 2021
The weather here in WA may be cold at present, but the residential property market is still red-hot. Sentiment in the commercial market may be a bit more subdued, but opportunities still abound for investors and businesses in the right situation. In the WA property market update for May 2021, we’ll once again explore the residential and commercial markets, where demand and prices are sitting, and what buyers and sellers can expect.
WA Residential Property Market Update May 2021
The more things change, the more they seem to stay the same. WA’s residential property market is still incredibly competitive and certainly favours the selling party – and this looks set to continue. The number of property listings and median selling days is still trending downwards, with some Perth suburbs reaching single figures for average days on market. Overall, the median days to sell a residential property more than halved between June 2020 and December 2020.
If you’ve set foot in a home open recently, you’ll know exactly how high the level of competition amongst buyers really is. The current state of play has left those looking to buy in a tricky situation, many choosing to “wait it out” and sit tight until the market cools down and competition reduces. However, according to Performance Property Group this may take so long that the relative ease of securing a property may be negatively outweighed by the likely increase in price, such is the suspected time one would have to wait. The price of the same home you’ve got our eye on right now may increase by 10-20% in the time it takes for the level of demand to reduce.
Because of this, punters are having to go that extra mile to get their offer accepted. No longer will saving a few searches on real estate websites and mulling around the odd home open be enough. Those who are serious about securing their own home are looking to things like finance pre-approvals, increased levels of research and consideration about the areas they’re looking at, improving their negotiation skills, and being more willing to budge on their price to give themselves the best shot of getting a deal over the line. Many properties are selling off-market now, owing to the incredible competition for houses across the state. Engaging with a buying agent may open a few more doors for you (pardon the pun) and give access to properties that won’t be hitting the open market. In summary, there appears to be no immediate remedy for the scorching WA residential property market. While prices rise, demand increases, and supply remains low, it is conceivable that it will remain tough out there for buyers for the foreseeable future.
WA Commercial Property Market Update May 2021
As one may expect, the commercial property sector is somewhat of a mixed bag at the moment. As some businesses continue to struggle off the back of the COVID-19 pandemic and the cessation of certain Government programs (e.g. JobKeeper), many investors are wary of jumping into lease agreements in case a tenant’s business goes under. On the other side of the coin, some generous incentives are on offer encouraging businesses to upgrade their premises to premium/A-Grade facilities. Some may take this up based on the financial implications of doing so, while others appreciate the need for more space in a socially distanced (but still collaborative) post-pandemic working world.
A key thing to remember is that the Western Australian economy is continuing to perform extraordinarily well under the circumstances, and a consistently high level of consumer confidence throughout 2021 means that good times appear to be on the horizon. We will have to wait and see what the real appetite is for upgrading workspaces, working-from-home preferences, and the status of Government schemes, but the foundations are there for a strong return to form in the commercial property sector.
As the Financial Year draws to a close, individuals and businesses alike will be looking to the future and facing some important decisions – do we ride the wave of a rebounding economy or take a conservative approach in case something goes wrong? No matter your disposition, don’t go into the property market without backup. The Property and Finance teams at McKinley Plowman have decades of experience working alongside clients to help them get the best outcomes in their property transactions. Get in touch with us today on 08 9301 2200 (Joondalup) or 08 9361 3300 (Victoria Park); or visit our website www.mckinleyplowman.com.au.
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