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WA Property Watch – Summer 2019
With the year drawing to a close, we can all reflect on what has been a relatively predictable year for the WA property market. The continuation of the downward trend in the market has seen Perth sit at the bottom of the cycle. A decrease overall in the median house price from February 2019 – September 2019, along with the lingering after-effects of the mining bust, sees WA’s property market continue to struggle. However, a pick-up in the rental market offers some good news. Read on to find out more…
The September quarter is often a sluggish time for house sales, and that on top of a 4% decrease in median house prices paints a pretty negative picture for WA’s housing market. Of particular concern are the outer fringe suburbs such as Ellenbrook, Baldivis, Banksia Grove and Jindalee; which have experienced fairly significant declines in house prices and increases in time on the market, with some residences selling for 20% less than they were bought only a few years ago. On the brighter side, there were a few suburbs that bucked this trend, with more affluent suburbs such as Rossmoyne, Cottesloe, Hillarys and Mount Pleasant experiencing strong growth despite it being a quieter time of year.
While overall sales have struggled in WA over the past year, the rental market has been strong. The vacancy rate has improved for the second quarter running, down to 2.5%, and the net migration being brought about by the ramping up of resources projects has increased demand. This is particularly noticeable in Karratha, which has seen a 27% reduction in leasing activity and an increase to the median rent price of $68 per week. Port Hedland and South Hedland are other regional centres which saw improvement over the past few months, also due predominantly to increased mining and resources activity. The market for rentals in South West WA has predictably bottomed out, but increased investment in the region is starting to raise the confidence of investors who may be looking to re-enter that market.
The relatively low house prices we’re seeing across the market right now present a fantastic opportunity for investors and first home buyers. As we explored in a recent article, great lending rates, low prices, strong demand for rentals, and excellent application rates for vacant rentals makes getting an investment property portfolio started is increasingly attractive, as is securing your first home.
Are you looking to get into your first home, or start your investment journey? Get in touch with the Property team at McKinley Plowman today on 08 9301 2200, or via our website.
Data retrieved from Herron Todd White Month in Review December 2019
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