Western Australia is again one of the most affordable states in Australia, according to the Real Estate Institute of Australia’s recent Housing Affordability Report. However, with rental yields exceeding those in both Sydney and Melbourne, investors are waking up to the potential of the Perth property market.
In July, Perth’s annual price growth was reported at just 10.8%. Perth was omitted from CoreLogic’s monthly data report in August, after the company noticed problems with one of its data sources, which had significantly undervalued homes in the city. However, in September, CoreLogic reported an 18.1% annual gain in housing values for Perth.
Despite this increase, the Housing Affordability Report for the June 2021 quarter, released last month, shows the proportion of family income required to meet average home loan repayments in WA was just 26.5%. In contrast, the proportion of family income required to meet average home loan repayments in NSW is 43.9% and 35.6% in Victoria.
When searching for properties within 10 kilometres of the city, the exceeding value of the Perth property market becomes even more clear, especially when compared to equivalent suburbs in Sydney and Melbourne.
According to CoreLogic data, Melbourne’s most affordable suburb within 10 kilometres of the CBD is Maidstone, where the houses average $922,681. Sydney’s most affordable suburb within that range is Arncliffe, where the average house price is $1.455 million. In contrast, Perth’s most affordable suburb within 10 kilometres of the city is Westminster, where the houses average just $404,000.
In fact, there are five suburbs within 10 kilometres of the CBD which have average house prices below $500,000. Another five have an average house price of less than $600,000.
Rental yields in Perth are also making investors take notice. In September, a three bedroom house in Perth provided a rental yield of 4.1%. An equivalent property in Melbourne was only yielding 2.7% and in Sydney just 2.5%.
With low interest rates, healthy yields, housing prices affordable but strong and a competitive rental environment, now is definitely the time to get into in the Perth property market, as an investor or an owner occupier.
Perth Suburbs Moving Up
Cooloongup saw the largest increase in average house values for September, up 4.5% to $320,000. Close behind was Bicton, with a 4% increase to $1.25 million. City Beach and Spearwood both experienced increases of 3.4% for September, rising to $2.175 million and $500,000 respectively. Harrisdale also made the top five, rising to $530,000, which is an increase of 2.8%.
The number of properties for sale was up 2% in September compared to August. With Spring selling season well underway, expect to see the number of listings continue to grow as more sellers come to market, which is welcome news for buyers.
Buyers can’t get too comfortable though, as the average time to sell a house in Perth during September was only 17 days, one day less than it took in August and 11 days faster than September last year.
New Website Launched
Resolve Property Solutions is pleased to announce the launching of their new website in October 2021.
We’ve had a makeover, and we’re sure you’ll love our fresh new look as much as we do. Come say hello!
As this long winter seems to continue to linger, it has delayed the supply of new properties coming to market, which we typically see in September. Tight supply and high buyer demand are driving more competition and price increases on good quality properties. According to REIWA, there are 8,455 properties for sale in Perth, 19% less than there was just one year ago. Looking deeper into those figures, there are only 4,188 houses for sale at the moment, which translates to only six weeks of supply.
Large land parcels are in high demand, in fact one recent sale attracted 22 offers from local, interstate and overseas buyers.
At Resolve Property Solutions, we are working with our clients to gain access to as many suitable properties as possible. As well as sourcing properties which meet our clients brief, we also search for off-market opportunities where possible to provide more options, and always ensure they are not paying too much for a property.
Resolve Property Solutions is an independent and qualified Buyer’s Agent specialising in Perth property. We will work hard for you to help your search, negotiate and secure your property goals at the best possible price.
Our story started with the passion for property and the research behind finding the right one.