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WA Property Market Update November 2023
In case you missed it – following several months of welcomed interest rate stability, the Reserve Bank (RBA) opted to increase the cash rate by a further 25 basis points in early November. Their campaign to rein in inflation continues, and this latest increase marks the 13th such upwards move in 18 months – coming at a time when many commentators predicted that we were at the peak of the rate cycle. For the property investors and owner-occupiers, it stands to reason that higher interest rates will compound the prevailing supply issues that plague the market. Here’s your WA property market update for November 2023.
WA Residential Property Market Update November 2023
In Western Australia, the residential property sector has shown remarkable resilience throughout 2023. The prestige market, particularly in Perth, has experienced a notable shift. While the luxury real estate landscape has adjusted to higher interest rates and changing consumer sentiment, the value offered in Western Australia remains unparalleled compared to the eastern states. For instance, a prestigious property on Mill Point Road in South Perth fetched $5.75 million in April, a testament to the market’s strength. Similarly, in Nedlands, a sale for $9.02 million highlighted the demand for high-end properties.
For many West Aussies, however, rising interest rates continue to put pressure on household budgets and will invariably impact supply on the market as sellers and buyers alike may seek greater stability before undertaking transactions. As always, watch this space – opportunities still abound if you know where to look, particularly with homes in need of renovation (see our September article for more on this).
WA Industrial Property Market Update November 2023
The industrial property sector in Western Australia has emerged remarkably robust and prosperous in 2023. The year witnessed a sustained demand for high-spec industrial premises, pushing rental rates to highs not seen since 2012. Despite the constraints in new construction due to limited land availability, especially in core industrial areas like Hazelmere and Maddington, market movements remained positive. Challenges like supply chain disruptions and labour shortages led to increased build costs, impacting the market’s dynamics. However, the sector’s resilience is evident in its ability to attract investments, particularly from the eastern states. The disparity in yield expectations did create some market friction, but the overall performance remained strong, bolstered by the mining and resources sector.
As we look towards 2024, the Western Australian property market stands at a significant juncture. The resilience shown in both residential and industrial sectors amidst fluctuating economic conditions speaks volumes about their inherent strengths. The industrial sector, in particular, is poised to continue its robust performance, supported by the thriving mining and resources industry. On the residential front, the prestige market’s adaptation to changing economic landscapes indicates a market ripe with opportunities. As we step into the new year, keeping an eye on these evolving trends will be crucial for navigating the property landscape in Western Australia.
If you need assistance with the Finance side of property, the MP+ Finance team are on hand to assist. Particularly as interest rates rise and cost of living concerns continue, it’s important to ensure that you’re getting the best possible deal for your home loan. Give us a call today on 08 9301 2200 (Joondalup), 08 9325 2411 (Perth), or contact us via our website.
Data from: HTW Month in Review November 2023
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