12 March 2018
Perth’s vacancy rate has dropped to 5.3 per cent – the lowest since July 2015.
REIWA President Hayden Groves said Perth’s latest vacancy rate for January 2018 had improved significantly since June 2017.
“It’s quite remarkable to see it this low considering seven months earlier Perth’s vacancy rate soared to 7.3 per cent – the highest we have ever experienced, and now it’s back at levels last seen in 2015.
“The vacancy rate is a good indicator for how the entire rental market is tracking, with reiwa.com data for February showing stable rent prices and declining listing levels. Leasing activity did drop off in February, however levels are still healthy and trending above long term averages,” Mr Groves said.
The reiwa.com vacancy rate is compiled using data obtained from a monthly survey of REIWA members. The survey details how many rental properties members manage and how many of those are vacant.
Mr Groves said there were a number of factors that had contributed to lowering the vacancy rate, such as an increase in population growth and a reduction in average tenure time.
“Population growth in WA has started to improve. Rental markets always feel the effects of population trends, with new entrants into the state the first to soak up rental stock.
“Tenants are also moving more frequently. In 2014 for example, the average tenure time was 45 months, fast forward to 2017 and it’s now 34 months, which is almost a full year less. This has led to an increase in leasing activity which has driven demand for rentals and had a positive effect on the vacancy rate.
“Another contributing factor is the reduction in the number of new dwelling commencements across the Perth Metro area. This has played an important role in lowering the vacancy rate. With less new dwellings coming onto the market, existing rental stock is now being soaked up, which is why rental listings have declined 19 per cent over the last year.
“After a challenging few years for landlords and investors, it’s pleasing to see some parity return to the rental market, with tenants and landlords seeing benefits simultaneously,” Mr Groves said.
13 February 2018
More Perth properties may soon be sold under the hammer. Photo: Peard Real Estate
With the Perth property market in a state of recovery, agents are predicting auctions will rise in popularity in favour of the traditional offer and acceptance sales method.
While latest Domain Group auction data revealed there were 180 auction listings in Perth in November, with a clearance rate of 30 per cent — in comparison to Sydney data for the same month of 4,187 listings with a clearance rate of 55 per cent — there were signs more homes will be sold under the hammer in Perth in 2018.
Domain Group data scientist Nicola Powell said a seasonality effect was obvious when looking at auction data for Perth, where there tended to be more homes for auction in the spring months.
Auctioneers expect to be busier in Perth this year. Photo: Dan Soderstorm
She said auctions were ingrained in the Sydney and Melbourne vendor market, and as the Perth property market began to recover, auction conditions might improve.
JLL buyers advocate Lachlan Delahunty said “auction” seemed to be a foreign word in WA.
“However, we should start to get comfortable with the process, as it will soon hit our shores,” he said.
“Properties sold under the hammer signify only three per cent of Perth property. Unfathomable when comparing that to the likes of Melbourne and Sydney with clearance rates of 80 to 90 per cent.
“Hot markets attract auctions – like bees to honey, as we have seen in Sydney in the early stages of last year.
“However, this form of selling is certainly no place for a soft market, which Perth has experienced in recent years, recording clearance rates as low as 30 per cent in the final parts of 2017.”
Mr Delahunty predicted if the WA market continued to improve during the first few months of this year, properties in coastal and blue chip suburbs would start to see the benefits of a bidding frenzy.
LJ Hooker national auction manager David Holmes said auction volumes in Perth remained steady and almost unchanged: 1973 in Perth last year, compared to 1964 in 2016.
“Perth is still a long way off the auction volumes of the eastern states – Melbourne recorded more than 50,671 auctions last year (a 19 per cent increase year on year) with Sydney notching 40,281 (a 16 per cent increase),” he said.
“However, at the end of 2017 and already in 2018, our offices have fielded more inquiries from sellers about the opportunities to auction their properties. LJ Hooker Kalamunda Foothills auctioned four times as many properties in 2017 than they did the previous year and expect to hold even more in 2018.
“Data has indicated a shift in the Perth market, with the first positive price recorded in the last quarter for a long time. When markets begin to recover, that’s when auctions rise in popularity as buyers openly compete to determine what new market value is.”
Rob Druitt, First National Real Estate Druitt and Shead principal and auctioneer, said auctions were on the rise in Perth, with buyers becoming more savvy in their understanding of the process.
“It’s unlikely in the short to medium term that we will catch up to the like of Melbourne or Sydney, however, as our market improves we are likely to see more auctions,” he said.
Mr Druitt said there were many benefits to selling and buying at auction.
“For the sellers, it is a quicker sale process and if the property is worth more than we all think, they will achieve it,” he said.
“For the buyers, in what is becoming a more competitive market place for certain types of properties, if they are organised, they have a genuine opportunity to buy the property in an open fair forum as opposed to properties selling off the market or quickly with multiple offers.
“For the market, it is good as it helps to genuinely set the market value of property and provides immediate feedback to the market on sales evidence and interest.
“Also, if the property doesn’t sell on the day of auction it will come on the market post-auction and is available to conditional buyers.”
Acton auctioneer Boyd Fraser said the benefits of auctions included a compressed campaign for 21 days and a 50 per cent chance of selling under the hammer on the day.
“Both buyers and sellers are in the same forum so transparency in the process is guaranteed. There is a significant difference in the number of days on market,” he said.
Western suburbs were popular areas for auctions, but other standout areas included Spearwood, Hamilton Hill and Coogee, Mr Fraser said.
08 February 2018
Parliament has passed the legislation allowing first home buyers to save for a deposit inside superannuation through the First Home Super Saver Scheme (FHSSS) and also allowing older Australians to ‘downsize’ and then contribute the proceeds of the sale of their family home into superannuation.
From 1 July 2018, a first home buyer will be able to withdraw voluntary superannuation contributions they have made since 1 July 2017(up to $30,000 each, with individuals being able to contribute up to $15,000 a year within existing caps), along with a deemed rate of earnings, to help buy their home.
Also, from 1 July 2018, when Australians aged 65 and oversell a home they have owned for at least 10 years, they may contribute up to $300,000 from the proceeds into their superannuation accounts, over and above existing contribution restrictions. Both members of a couple may take advantage of this measure, together contributing up to $600,000 from the proceeds of the sale into superannuation.
30 January 2018
Author: REIWA President Hayden Groves via reiwa.com.au
After a solid couple of years of subdued conditions in the Perth property market, we can look back on 2017 as a transitional period that brought about the bottom of the market.
Coming off the back of a very soft 2016, the Perth property market regained its foothold in 2017, with stable listings, sales and median house price levels observed.
The stability we are now witnessing across key market indicators is a welcome change.
What to expect in 2018
The forecast for 2018 is that the Perth market will moderately and steadily improve, however REIWA cautions against expectations of rapid growth in either the established housing or rental markets over the coming year.
In 2017 there was an average of 489 property sales recorded each week, which REIWA forecasts will lift to approximately 500 sales per week over the next six months. If sales volumes continue to trend at current levels, listing volumes will begin to fall, creating upward pressure on prices as demand builds.
We saw listings for sale start to level out and decrease last year, peaking at just over 15,000 in early 2017, before reaching a low of just over 13,000 in September.
With new dwelling activity set to decline in 2018, REIWA forecasts the number of properties for sale in Perth to remain at current levels over the next year, a level commensurate with market parity.
Perth rental market
Perth’s rental market also appeared to turn a corner in 2017, with listings declining from 11,000 in January to just over 9,300 by December.
Over this same time, leasing activity levels were strong, with approximately 1,180 rentals leased each week. If this trend persists, the balance between supply and demand of stock will continue to improve in 2018.
In a welcome change for investors, Perth’s median rent price has stabilised at $350 per week since April last year. While we don’t anticipate there will be significant growth to median rent prices in 2018, they’re not likely to fall either with quality family homes in particular in strong demand.
The Perth market is no longer experiencing significant declines in median house and rent prices, nor are we seeing listings for sale and for rent increasing at the rate they once were.
As market conditions improve and confidence returns, competition among buyers will inevitably increase.
If you’re thinking about purchasing your first home, trading-up or investing in property, my advice is to act sooner rather than later and take advantage of the stable and favourable market conditions.
To discuss your valuable investment with our Business Development Manager Sarah Morgan, give us a call on 9475 9622
16 November 2017
Housing affordability remains a hot button issue across the nation, and rightfully so. It’s a significant concern for a growing number of West Australians, particularly those on low and very low incomes, many of them facing the prospect of never being able to afford a home of their own.
Housing affordability has improved in WA
Despite this growing issue, house prices in WA have become more affordable over the last couple of years and have not increased at the rate they have in other states over the past decade. For example, Perth’s median house price for the year to June 2017 was $520,000, which is only approximately $60,000 more than it was at the same time in 2007.
By comparison, the Sydney housing market has seen its median house price increase by a staggering $600,000 over this same period, making it substantially more difficult for first home owners to enter that market market.
We are fortunate the dream of home ownership is still very much attainable in Western Australia. In fact, REIWA analysis shows it’s more financially attainable to be a home owner in 2017 than it was in 2007, with West Australians now spending a smaller percentage of their total income on mortgage repayments than they did a decade ago.
Specifically, home owners were spending approximately 56 per cent of their total income on mortgage repayments in 2007, whereas today that figure has reduced to 27 per cent. This improvement in affordability for WA home owners can largely be attributed to average income levels having increased since 2007. At the same time interest rates have gone down and house prices have remained relatively on par.
Perth property market appears to have stabilised
Home buyers remain in a strong position in Perth, but the signs do indicate the local property market has stablised.
Since July 2017, reiwa.com’s monthly data has revealed steady figures across a number of key indicators, such as median house price, median rent price and listings for sale and for rent. Historically, one of the strongest indicators a property market may be on the cusp of ‘turning’ is a period of stability.
Now is the time to buy
If you’ve been holding off making a property purchase because you’re waiting for the ‘bottom’ of the market to buy at the lowest possible price, I’d advise you to take action sooner rather than later. We don’t usually have the luxury of calling the ‘bottom’ of the market until we have the benefit of hindsight; meaning, we’re not certain the market has turned until it’s on the way back up.
With improved house prices, record low interest rates and a healthy supply of stock to choose from, now is the time to take advantage of Perth’s favourable buying conditions.
31 October 2017
Peter Williams via thewest.com.au
Billionaire Kerry Stokes has added his weight to the view that conditions are ideal for entering the housing market, staking his reputation on now being the best time to take the plunge.
The Seven Group Holdings and Seven West Media chairman said the situation came as the State showed it was recovering from the shock of miners cutting their costs by a combined $10 billion in recent years.
“Right now any young person out there, any apprentice, worker, tradesman — the best thing they’ll ever do in their life is walk out this weekend and buy a home in Western Australia,” Mr Stokes told a WestBusinessLeadership Matters event on Tuesday.
“With interest rates low, housing prices low, this is the time to think of their future right now. I’d put my reputation on the fact this is the best time for them to do that,” he said.
“If that’s the case and everybody else agrees with that, then we’re past the bottom.”
Mr Stokes’ remarks follow Housing Industry Association figures showing affordability in WA had improved dramatically, in part because of national efforts to tighten bank lending standards for investors.
In the past two years, loan repayments on a median-priced house in Perth fell by more than $260 a month, or $3120 a year. Elsewhere in WA, they fell to $1545 from $1773 a month.
Kerry StokesPicture: The West Australian
However, a report yesterday showed Perth had the nation’s second-most expensive residential land prices at $730 per square metre, a 5 per cent gain over the year to June. The Housing Industry Association-CoreLogic Residential Land Report said land prices rose by 19.6 per cent in Melbourne and 9.8 per cent in Sydney.
Mr Stokes said the State’s economy was showing signs of improvement after miners’ efforts to improve efficiency had contributed to the downturn.
Leadership Matters Lunch with The West Australian: Country Chair for Shell Australia Zoe Yujnovich. Photo by Michael Wilson, The West Australian.
Ben WyattPicture: The West Australian
“So when they’ve saved some $10 billion in costs that’s supposed to come out of workforces in WA. That’s a shock we have to get over and we’re actually getting over it now.”
WA Treasurer Ben Wyatt told the event that competition in the retail gas market had largely offset the increases the McGowan Government had imposed on electricity tariffs.
Discounts of up to 30 per cent are on offer with new player Origin Energy this month, joining AGL, Kleenheat and Alinta in the gas price war.
At the Leadership Matters event are WA Newspapers Group Business Editor Ben Harvey, Treasurer Ben Wyatt, Rob Scott (Wesfarmers), Zoe Yujnovich (Shell), Tom O’Leary (Iluka) and Kerry Stokes. Pictures: Michael WilsonPicture: Pictures: Michael Wilson
Mr Wyatt said that situation could last until the early 2020s.
Incoming Wesfarmers chief executive Rob Scott said while the loss of disposable income and lower population had hit retail businesses hard, there was cause for optimism.
“We still see opportunities,” Mr Scott said. “We see a good path for growth.”
10 October 2017
The McGowan Government has handed down its 2017-18 State Budget and has listened to the concerns of the WA property industry by not meddling with property taxes.
In the Treasurer’s speech, the Hon. Ben Wyatt MLA advised the State Government did not consider increases to property taxes for WA residents as part of their Budget repair measures, recognising the impact of the three consecutive land tax increases in previous Budgets.
REIWA Deputy President Damian Collins said given the McGowan Government had faced challenges when it came to the State’s fiscal position, it was pleasing to hear there would be no increases to property taxes for WA residents.
The Government is planning to introduce a four per cent foreign owner duty surcharge on purchases of residential property by foreign individuals and entities from 1 January 2019. This is expected to create $49 million in revenue by 2020-21.
“The introduction of a new foreign owner duty surcharge could hinder overseas property investment. Despite foreign investors only representing a small proportion of the WA property market, caution must be placed to ensure this section of the market does not reduce further.
“The Government expects to create revenue from this surcharge, however, it may only worsen the situation in terms of transfer duty revenue, as potential foreign investors may be less incentivised to purchase residential property in WA,” said Mr Collins.
In its pre-budget submission, REIWA recommended the Government introduce five key areas of reform:
- Make no further changes to rates or thresholds for land tax.
- No increase to transfer duty rates or change thresholds.
- Undertake a state tax review to assess the viability of a shift to a broad-based land tax system that ultimately removes transfer duty.
- Maintain the existing transfer duty exemption for first home buyers at $430,000 and re-introduce the $3,000 First Home Owners Grant for existing dwellings.
- Introduce a $10,000 concession on transfer duty for seniors over the age of 65 to encourage ‘right sizing’.
“REIWA welcomes the State Government’s commitment to keep property taxes on hold for WA residents and whilst some of the reforms we recommended were not addressed in the Budget, we appreciate the current fiscal position,” said Mr Collins.
The State Budget also revealed that growth in the State economy is expected to recover from 0.25 per cent in 2016-17, to three per cent in 2017-18. Employment growth is also forecast to recover, with nearly 20,000 jobs expected to be created in 2017-18, attributed to a modest increase in population growth expectations.
“The McGowan Government should be congratulated on their efforts in reducing the State’s debt. REIWA will continue to work with the Government to help home ownership become a reality for more West Aussies and also assist the Government in getting the Budget back to surplus,” said Mr Collins.
03 October 2017
Written by Natalie Hordov via Eastern Reporter REAL ESTATE
THE Perth property market is showing signs of stability with both the median house price and overall median rent holding steady in the three months to August 2017.
According to reiwa.com data, the median house price was $515,000, while the median rent was $350 per week for the fourth month in a row.
President Hayden Groves said it was encouraging to see the median price remain firm across both sectors of the Perth property market.
“The stable medians are good news and indicate that seller’s and landlord’s expectations are matching those of buyers and tenants,” he said.
Listings for sale have continued to trend downwards over the past month, decreasing by 1 per cent and are 10 per cent lower than three months ago.
“The reduction of properties for sale should create a better balance between the supply and demand of Perth’s overall housing stock,” Mr Groves said.
“Traditionally in spring, there tends to be a lift in sales activity which means there is potential for the median house price to increase in the coming months as we see more demand for housing and increased competition from buyers.”
In the residential rental market, reiwa.com data showed stock reduced by 6 per cent to 10,046 properties for rent, with leasing activity up by 8 per cent during the month of August.
“The boost in leasing activity is pleasing to see and has contributed to the declining trend in listings levels as rental stock gets absorbed due to the demand from tenants,” Mr Groves said.
“This improved activity is also helping to keep the overall median rent in check at $350 per week, stable for the fourth consecutive month, which is welcome news for landlords and property managers alike.
“With the warmer weather ahead, we should typically see both buyer and tenant activity levels increase.
“Together with the stabilising trends in median house and rent prices, the Perth property market is showing positive signs as we head into spring and summer.”
12 September 2017
With spring expected to draw an influx of buyers, and amid tight supply of properties for sale, Perth property prices could rise in the coming months, says Hayden Groves, president of the REIWA.
The Perth property market is showing positive signs as we head into spring and summer,” says Hayden Groves, president of the REIWA.
New data from the REIWA shows Perth’s median house price and median rent held steady in the three months to August 2017.
The median house price remained consistent at $515,000, and the overall median rent was stable at $350 – the fourth consecutive month rents have held steady.
REIWA President Hayden Groves said the results are “encouraging”.
“The stable medians are good news and indicate that sellers’ and landlords’ expectations are matching those of buyers and tenants,” said Groves.
Property listings down 10 per cent for the quarter
The reiwa.com.au data shows listings for sale eased one per cent lower in August, and are down 10 per cent compared with three months ago.
Groves said prices could rise in spring, when it’s likely demand will pick up.
“Traditionally in spring, there tends to be a lift in sales activity,” he said.
“There is potential for the median house price to increase in the coming months as we see more demand for housing and increased competition from buyers,” said Groves.
In the rental market, stock is down 10 per cent, and leasing activity is up 8 per cent
In the residential rental market, reiwa.com data shows stock levels declined by six per cent to 10,046 properties in August, and leasing activity rose by eight per cent.
“The boost in leasing activity is pleasing to see and has contributed to the declining trend in listings levels,” said Groves.
“Rental stock gets absorbed due to the demand from tenants,” he said.
05 September 2017
Nicole Cox via realestate.com.au
Perth’s property prices have dipped more than 10 per cent in the past three years, but a new report suggests evidence of some relief with the rate of decline abating.
The latest CoreLogic Hedonic Home Value Index shows house values in Perth have fallen by 2.6% so far this year, making it the worst performing capital in Australia.
In August, Perth property prices dropped 0.8%, compared to the 1.3% decline in July.
House prices suffered a 0.9% drop, while unit prices fell by 0.6%, bringing the median property price in Perth to $462,927.
In August, Perth property prices dropped 0.8%, compared to the 1.3% decline in July. Picture: Getty Images
August property data showed Perth and Darwin continued to endure declining dwelling values, which had trended lower over the past month and rolling quarter.
“However, the annual trend highlights the rate of decline has been easing,” the report says.
“Since peaking in 2014, Perth dwelling values have declined by a total of 10.8%, while the cumulative decline across Darwin has been more severe with values down 18.6% from the market peak.”
CoreLogic head of research Tim Lawless says despite lagging property values in Perth, it was still one of the most affordable markets in the country.
“The silver lining around the decline in values is a substantial improvement in affordability,” Lawless says.
On Tuesday, WA Housing Minister Peter Tinley told a Committee for Economic Development Australia that lower-income earners were still being priced out of the Perth property market, despite softening values.
Tinley said Perth’s shortage of affordable housing, coupled with stagnant wage growth and the high cost of living had contributed to low-income earners being unable to realise the great Australian dream of home ownership.
CoreLogic says national dwelling values remained flat during August, with capital city values edging 0.1% higher. Simultaneously, regional dwelling values slipped 0.2% lower.
The report says the slowdown in growth has been most visible in Sydney, while the Melbourne market has been more resilient with auction rates consistently above 70%.
22 August 2017
Author: REIWA President Hayden Groves
Modiefied via reiwa.com.au
Over the last couple of years as the Perth property market has slowed, there has been a lot of talk about ‘waiting for the bottom of the market’ to arrive.
In an ideal world, it would be crystal clear when the bottom had arrived and primed buyers could act immediately to secure their dream home, content in the knowledge they had purchased their property at the absolute lowest possible price.
How do you tell when the bottom of the market has hit?
The truth is, it’s virtually impossible to tell whether the actual ‘bottom’ has hit until it has passed and we’re on the upswing again. The best we can do is observe trends in the market and make an educated guess. It’s not an exact science and can be influenced by a number of external factors, such as the economy, consumer sentiment and state and federal elections.
In Perth, signs over the last quarter suggest our local market is beginning to stabilise, with all key indicators (median house price, sales activity, listings for sale, average selling days and discounting) recording little or no change in the three months to June 2017.
Historically, one of the earliest signs of a change of momentum in the market is a period of stability. Although no one can accurately ascertain the future of the property market, the signs are there that we have finally found, or are very close to finding, the bottom.
Take advantage of affordable conditions
If you’ve been thinking of buying a home or purchasing an investment property, but have been holding off for the ‘right’ moment to strike, I’d advise you to take action sooner rather than later. Although we might not be able to predict with absolute certainty the ‘bottom’ of the market, we do know that property markets are cyclical and conditions will change again.
With the signs there that we’re heading into a period of stabilisation, now is the time to buy. There is lots of choice in the market with listings for sale , so you are in the best possible position to find a home that meets all your requirements at a competitive price.
I would advise buyers who are considering purchasing property in this market to take advantage of the steady, but quieter conditions. Do your due diligence and view a range of different properties in suburbs that appeal to you to ensure you explore all your options.
If you’re unsure what the best move is, speak to us on 9475 9622 or email us at firstname.lastname@example.org about your plans. They are well educated on your local market and will be able to advise what is most suitable for your situation.
15 August 2017
Rachel Preston-Bidwell via reiwa.com.au
Perth home buyers looking to trade up are now seeing more opportunity in areas such as Peppermint Grove, Applecross and North Coogee, which topped reiwa.com’s list of affluent suburbs which have become more affordable.
REIWA President Hayden Groves said while prices in these suburbs were still well above the Perth median house price, they had become more affordable for buyers looking to trade up into those million dollar suburbs.
Peppermint Grove saw the biggest annual average change in its median house price over the past five years, shifting from $3,750,000 (year to April 2012) to $3,350,000 (year to April 2017).
“Buyers are looking for opportunities in areas with a good lifestyle scene, cafes and restaurants. In particular, we are seeing buyers placing more importance on proximity to good public schools.
“Suburbs such as Applecross, Nedlands and Peppermint Grove are within the catchment for some of Perth’s best public schools. Due to the easing off in median house prices of these suburbs, the opportunity is there to secure your ideal family home if you have the means,” said Mr Groves.
There’s also good news for sellers in Applecross, City Beach, Nedlands and Peppermint Grove, as properties are selling quicker in comparison to five years ago.
“In 2012, it took on average 120 days to sell a property in Peppermint Grove for instance. In more recent figures, the average selling days for the suburb sits at 90 days.
“We are also seeing sellers willing to negotiate and discount their initial asking price to achieve a sale,” said Mr Groves.
The average discount sellers in the five suburbs are applying to their asking price is around the eight to ten per cent mark in the year to April 2017 data.
“Both buyers and sellers are benefitting from the current market conditions in these million dollar suburbs,” said Mr Groves.
||MEDIAN HOUSE PRICE (YEAR TO APRIL 2012)
||MEDIAN HOUSE PRICE (YEAR TO APRIL 2017)
||AVERAGE SELLING DAYS (YEAR TO APRIL 2012)
|| AVERAGE SELLING DAYS (YEAR TO APRIL 2017)
|1. Peppermint Grove
|3. North Coogee
|4. City Beach
Figures based on median house prices in the year to April 2012 versus year to April 2017. Filtered for suburbs with greater than 15 sales, with a median house price of more than $1 million.
02 August 2017
Nicole Cox via realestate.com.au
Perth’s house prices took another dip in July, but the outlook is brighter for owners of units and apartments with an improvement in values, new data from CoreLogic shows.
Perth retained the unenviable title as the weakest performing property market in Australia, with a combined drop in dwelling values of 1.3% for July.
The CoreLogic Hedonic Home Value Index reveals that unit prices surged 1.8% in July and 4.2% in the past three months to a median price of $400,000, but house prices dropped 1.6% last month to return a 2.5% decline since the same time last year.
The median house price in Perth is now $498,200.
CoreLogic says there has been a slowdown in growth conditions in the hottest markets of Sydney and Melbourne.
At the other end of the growth spectrum, Perth and Darwin have continued to see dwelling values slip lower during July, taking the cumulative decline to 10.2% in Perth and 14.5% in Darwin since both markets peaked in 2014.
“The ease in the rate of decline has been most visible in Perth, providing a signal that the Western Australian capital may be approaching the bottom of the downturn,” the CoreLogic report found.
“Listing numbers have been falling across Perth which is a positive sign of improving conditions and transaction numbers have found a new floor at around 2500 sales per month.”
CoreLogic Head of Research Tim Lawless says while the market has slowed from recent highs, growth remains robust.
“I don’t think there is any one factor causing the market to lose steam, rather it is the culmination of several factors working together,” Lawless says.
“Higher mortgage rates and tighter credit policies have dented investor appetite. This is clear from the RBA’s monthly credit aggregates which show investment related housing credit growth has consistently slowed from late last year.”
He says higher mortgage rates are now also impacting on interest only loans as well as fixed rate loans, which is likely to further deter some prospective buyers.
25 July 2017
Perth sellers struggling to sell should look at going to auction, with reiwa.com data revealing it was 42 days faster to sell by auction in the metropolitan area than by private treaty in the three months to June.
REIWA President Hayden Groves said while auctions represented a small component of the Perth property market, those sellers who did choose to list their property for auction were experiencing significantly faster selling times.
“On average, it takes around 70 days to sell by private treaty in Perth, but sellers who go to auction are achieving sales in as quickly as 28 days,” Mr Groves said.
“In this market, when there is plenty of competition between sellers to secure a buyer, standing out from the crowd is paramount. Selling at auction has plenty of benefits for the vendor, with a short but high profile marketing campaign bringing serious buyers to the forefront quickly.
“You also have the security of knowing if your home doesn’t sell at the fall of the hammer, you can continue to negotiate a purchase price with those interested buyers after the auction using the more familiar private treaty method.”
reiwa.com data shows auction sales in Perth peaked in December 2016, lifting to 2.31 per cent of total sales activity in the metro area for that month, before returning to just below two per cent by March 2017.
“Auctions are still relatively unfamiliar to West Australians, but you only have to look to the East Coast, particularly Sydney and Melbourne, to see how successful this method of selling can be. I encourage WA sellers to speak with their real estate agents about whether auctions are the right fit for them,” Mr Groves said.
Here at Porter Matthews Metro we have a well thought out Auction process and success rate, if you have queries as to how this method might suit you, please give us a call on 9475 9622 or email us at email@example.com
18 July 2017
July 14, 2017 6:00am
Perth’s property market could be about to turn the corner, experts say.
WA PROPERTY markets could go from the nation’s worst to its best-performed over the next two years as buyers regain confidence in the State and go cold on the rest of the country.
National Australia Bank analysis suggests WA has reached the bottom after several years of falling property prices, growing rental vacancy rates and the biggest fall in rents since the early 1990s.
NAB chief economist Alan Oster said there were clear expectations among property analysts that the WA market would improve relative to the rest of the country over the next two years.
“In WA, where the local housing market has under-performed relative to the Eastern States after the mining investment slowdown, house prices are expected to rebound and grow 1.3 per cent,” he said.
Experts surveyed by NAB believe Armadale, Bentley, central Perth and Scarborough look the best prospects in the city.
Sydney and Melbourne have seen double-digit price increases in the past two years but the NAB survey believes these two will slow down.
Victoria’s market is tipped to be the weakest within two years, with WA vying with Queensland for top spot.
The improvement in the WA market is tied to a lift in the jobs market.
The survey found employment security was the single largest impediment for buyers of existing property in WA but, with signs the jobs market has bottomed and may be improving, this is tipped to be less of a negative in the next two years.
Mark Passmore, of Passmore Real Estate in Morley, said there had been a noticeable lift at the higher end of the market, which was a sign the entire market was shifting.
He said interest was growing in sought-after suburbs where prices had dropped over recent years as confidence in the overall market and economy had improved.
“You can feel that the market is at a pivotal point,” Mr Passmore said.
He said a drop in the price of land had brought developers back into the market while more varied selling methods, such as auctions, were being used to get buyers back.
14 June 2017
Jennifer Duke via domain.com.au
Housing was a hot button topic for the 2017/2018 federal budget, so it’s no surprise there were a raft of changes for real estate.
The new measures have impacted on a variety of housing rules from first-home buyers’ savings strategies to what investors can claim at tax-time.
Here are the five big announcements to know about.
More supply is just one part of the housing push with a raft of initiatives rolled out in the 2017/2018 federal budget. Photo: Pat Scala
1) Foreigners can only buy up to 50 per cent of a development
Under the new budget rules, developers will no longer be able to sell every property in their new development to overseas buyers.
Instead, a maximum of half the development can be sold to foreign buyers with the rest to be sold locally. The budget documents note this is to provide a “clear message” that new housing stock is expected to increase supply for Australian buyers.
Before this change developers required pre-approval to sell properties to foreign buyers but there was no limit on the proportion of sales.
Effect on revenue: No impact
In place from: May 9, 2017
2) First Home Super Saver Scheme
First-home buyers weren’t ignored by the budget with a new First Home Super Saver Scheme announced. The new super saver scheme will allow first-time buyers to put up to $15,000 a year, to a maximum of $30,000 under the scheme, into their superannuation.
These funds can later be withdrawn for a home deposit, including any earnings the deposits made.
This means they will have a tax incentive to save more, and it can be taken advantage of as a couple with each claiming $30,000.
Effect on revenue: Cost of $250 million ($9.4 million funding given to ATO)
In place from: July 1, 2017 (contributions), July 1, 2018 (withdrawals)
3) An ’empty home’ tax on foreign investors
Foreign investors who keep properties vacant for more than six months will be faced with a vacancy tax. This is described as a charge on “underutilised residential property”.
The cost of this tax will be the equivalent of their foreign investment application fee – some several thousand dollars – and will be charged annually.
This change is intended to get more vacant homes onto the rental market.
Effect on revenue: Gain of $16.3 million ($3.7 million funding given to ATO)
In place from: May 9, 2017
4) Stopping investors from claiming travel deductions
Investors who previously had tax deductions for travel expenses related to their investment property will no longer be able to make these claims.
The government has ruled them out, even for those travelling to collect rent, maintain or inspect a premises, saying many have been incorrectly obtaining this deduction. This has included situations for “private travel purposes”.
Effect on revenue: Gain of $540 million
In place from: July 1, 2017
5) Retirees given incentives to downsize
Australians aged over 65 who sell their home of a decade or more will soon be able to put up to $300,000 in sale proceeds into their superannuation.
This incentive to downsize is expected to help free up larger homes for families to move into.
Effect on revenue: Cost of $30 million
In place from: July 1, 2018
14 June 2017
A new rental affordability study has highlighted the challenges very low and low income households face in Perth’s private rental sector.
The study, Housing Affordability (Rental) – A study for the Perth metropolitan area, looks at rental affordability for households on very low (less than $43,000), low ($43,000-$69,000) and moderate incomes ($69,000-$103,000), and is the result of a second collaboration between the Housing Authority, Real Estate Institute of Western Australia (REIWA) and Shelter WA.
The report found:
- There is insufficient affordable rental options in Perth’s private rental sector, which is placing pressure on the region’s social housing system.
- 35 per cent of Perth rental households fall into the lower income categories, however only 19 per cent of rentals in Perth in the 2015-16 financial year were affordable to very low or low income earners.
- Perth’s rental stock lacks diversity, with over 70 per cent of all rentals across the metropolitan area have three bedrooms or more.
- The central sub-region contains the bulk of affordable rental housing in Perth. It provides 65 per cent of affordable housing for very low income earners and 49 per cent for low income earners.
REIWA President Hayden Groves said all sectors of the property market need to work together to increase the number of affordable rental properties.
The Housing Authority’s General Manager Strategy and Policy Tania Loosley-Smith noted that although the Western Australian property market has been in a cyclical downswing for the past few years, there is still a significant shortage of housing that is affordable for Western Australians on low incomes.
“By a range of measures, this shortage has entrenched over decades and deepened in the last 10 years. It affects our vulnerable citizens, as well as the key workers who are the backbone of our economy,” Ms Loosley-Smith said.
“The Housing Authority is committed to addressing these challenges in order to ensure Western Australian families, our local communities, and our economy thrive. That said, achieving these outcomes needs both Commonwealth and State leadership.”
Ms Loosley-Smith said she welcomed the Commonwealth Government’s commitment to establish a National Housing Finance and Investment Corporation, and its focus on models to increase affordable rentals for people on low incomes.
“Large scale market investment in our rental sector, particularly at the affordable end of the market, is the missing part of the Australian housing continuum and can only be tackled effectively at a national level. This, combined with ongoing funding for the social housing system under the National Affordable Housing Agreement and ongoing State efforts on housing supply and diversity is critical to ensuring that all Western Australians have a place to call home,” Ms Loosley-Smith said.
At the state level, the Housing Authority in late 2016 launched the Assisted Rental Pathways Pilot. According to Ms Loosley-Smith, this innovative initiative provides opportunities for social housing applicants—with the desire and means—to move successfully into the private rental market.
“This Pilot is a unique partnership between the government, not-for-profit support providers and participants. It offers rent subsidies and individually tailored support services for up to four years to help people succeed in the private rental market. The project offers benefits for both participants and landlords, and is important in addressing the key finding of the study—the lack of affordable rentals in Perth, despite a high overall rental vacancy rate.”
Mr Groves said housing affordability was a critical issue for West Australians and the report emphasised the glaring need for a greater emphasis on the provision for affordable, accessible and appropriate housing options.
“It is clear that the current stock of private rental accommodation does not meet the needs of our community and more needs to be done to address the requirement for choice and housing diversity. The planning system needs to mandate and address housing diversity within the WA planning system,” Mr Groves said.
Shelter WA spokesperson Stephen Hall said the research highlighted the lack of accessible and affordable private rental accommodation in Perth for very low and low income households, with only a small number of three or more bedroom properties available to these income brackets.
“This research shows that only a small number of three or more bedroom properties are affordable for lower income families. Shelter WA is concerned that families, especially large families, could be forced to reside in inappropriate and unaffordable housing.”
“It is also concerning that households, on very low incomes, including those on disability and aged pensions, are confronted with so few rental options in the Perth metro area. Seniors and those living with a disability, often already have difficulties in their lives, which can be exacerbated by unaffordable and insecure housing.”
“Improving inefficiencies in the planning system, replacing stamp duty with a progressive land tax, and ensuring social and affordable housing is provided in and around new developments such as Metronet, can improve the availability of affordable accommodation for Perth households,” Mr Hall said.
The Housing Affordability (Rental) – A study for the Perth metropolitan area is a follow up to a study released last November which focused on the impact of housing affordability on home ownership.
14 June 2017
Housing affordability and rental affordability improved in Western Australia in the March quarter 2017, according to the findings of the latest Adelaide Bank/REIA Housing Affordability Report.
The report found affordability in WA’s housing market improved over the quarter, with the proportion of income required to meet loan repayments decreasing 0.9 percentage points to 23.4 per cent.
Affordability also improved over the year, with figures showing the proportion of income required to meet loan repayments in the March quarter 2017 declined by 1.1 percentage points compared to the March quarter 2016.
WA’s rental market was more affordable in the March quarter than it was in the December quarter, with data revealing the proportion of family income required to meet the median rent price decreased by 0.5 percentage points to 18.6 per cent.
Compared to the same time in 2016, the proportion of income required to meet the median rent decreased by 1.6 per cent.
First home buyers
The volume of first home owners in the market decreased by 6.5 per cent in the March quarter to 3,562, and by 1.8 per cent when compared to the March quarter 2016.
The report found that of all first home buyers in Australia, 17.2 per cent were from WA. Additionally, that proportion of first home buyers in WA equated to a significant 31.5 per cent of the state’s owner-occupier market.
The average amount WA first home buyers spent on their loans in the March quarter decreased by 4.1 per cent to $307,800. Affordability in this sector improved further when compared to the same time last year, by 4.9 per cent.
There were 11,301 loans (excluding refinancing) taken out in the March quarter, which is a dip of 6.4 per cent on the December quarter 2016 and 3.2 per cent on the March quarter 2016.
The average loan size amount also decreased in the March quarter, by 3.8 per cent to $337,812. Compared to the same time last year, this figure is down 0.6 per cent.
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07 June 2017
There are fears the launch of a “rent bidding” app will push Aussie rents up even higher. Photo: Jim Rice
Following a lengthy period of falling rents and sharply rising vacancy rates, early signs are now emerging that the Perth rental market may be steadying.
Latest Domain data reports that the median asking rent for a Perth house over April remained at $360 per week, the same as reported over the previous month. Although steady over the month, Perth house rents are 10.0 per cent lower than recorded over April 2016.
Median asking rents for units were also steady at $300 per week over the month but similar to house rents have fallen sharply over the past year – down by 14.3 per cent.
Similar to rents, Perth vacancy rates have also stabilised over April at 3.9 per cent for houses and for units down from 4.2 percent recorded over March to 4.1 per cent. Total vacancy rates for both houses and units combined fell to 3.9 per cent over the month which was the lowest result since March 2016.
Although rents and vacancy rates have steadied over the past month, Perth remains the most tenant-friendly mainland capital with relatively low rents and a wide choice of available homes. By contrast, vacancy rates in most other capitals are generally tight and tightening for both houses and units.
Sydney remains the most expensive capital for tenants with a median asking weekly rent over April of $550 for both units and houses. This is an increase of 3.8 per cent for each over the past year and 52.8 per cent higher than Perth for houses and remarkably 83.3 per cent higher for units.
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30 May 2017
The Western Australian State Cabinet decision to move forward with the strata title reform process has been commended by the Real Estate Institute of Western Australia, Strata Community Association WA, Property Council of Australia and Urban Development Institute of Australia WA.
Announced this morning, the Honorable Rita Saffioti MLA said strata title reform was important to the future housing needs of WA and the McGowan Government would be progressing with this legislation as quickly as possible.
The proposed reforms to the Strata Act, which were drafted by Landgate, cover off seven key areas:
- Community title schemes
- Leasehold strata
- More flexible staged strata development
- Improved management
- Simplified dispute resolution
- Better buyer information
- Safeguards for the termination of schemes
REIWA President Hayden Groves said reform to the Strata Titles Act was long overdue and he was pleased the new State Cabinet would be implementing these reforms.
“REIWA is committed to the strata title reform process, and we are particularly supportive of more buyer information being disclosed and making sure buyers know what they are getting into,” Mr Groves said.
Strata Community Association President Scott Bellerby said the drafted reforms are desperately needed and would help provide more flexible and sustainable housing options.
“The current reforms are a good first step to helping define the role of the strata manager and will provide improved management of schemes, however, further regulation and licensing is still needed.
The Minister should commit to the formation of a working group after the current reforms are passed, to deliver a licensing platform for the State Government to adopt early next year,” Mr Bellerby said.
Property Council Executive Director Lino Iacomella said the introduction of community titles in particular will make a real difference by encouraging more mixed use development in and around activity centres and retirement villages, offering greater amenity to residents and more sustainable local economies.
“These reforms will also provide better outcomes for communities, improving housing choice and affordability for all West Australians,” Mr Iacomella said.
UDIA WA CEO Allison Hailes said The Urban Development Institute of Australia strongly supports the proposed reforms to the Stata Title’s Act, particularly the introduction of community title schemes, leasehold strata and staged strata development.
“The reforms will bring Western Australia’s strata titles legislation in to line with other Australian jurisdictions and result in more affordable and diverse housing being delivered. UDIA encourages all decision makers to support the passage of the new legislation through Parliament as a matter of priority,” Ms Hailles said.
The property industry congratulates Landgate and the McGowan Government for taking a leadership position on such a vital component of the future of WA property.