These comments are the writer’s own and do not necessarily reflect the current opinions and policies of the Real Estate Institute of Western Australia.
The latest numbers from Landgate and the Real Estate Institute reveal the number of property transactions throughout Perth were a disappointment after a promising start to the year. Volumes remain remarkably low compared to the fifteen year average. Overall, sales volumes are tracking marginally below that of 2017 (which was the lowest level since 1990); extraordinary considering our population growth and increase in housing stock over the past ten years.
Median house prices dipped last quarter preliminarily reported to be $515,000 off by 2.5 per cent from last year mainly due to a compositional change in the market with a higher proportion of “outer-ring” suburbs selling at a lower price point compared to the more costly inner suburban areas.
Fremantle’s median house price fell for the quarter across all suburbs. Beaconsfield shot up 6.2 per cent for the quarter as did Samson with an impressive 12.9 per cent increase across a miserly 7 sales. Fremantle itself had only 23 house sales across the quarter returning a median house price of $757,500, a rise of 2.2 per cent from last year but only 0.9 per cent better than five years ago and half a percent better than this time in 2008.
The better performing local suburbs include White Gum Valley and South Fremantle with 2.7 and 3.9 per cent annual growth respectively in median prices over the past five years. Ten year median house price annual changes are generally flat with the best performing suburb of White Gum Valley returning home owners a mere two per cent annual growth rate throughout the last decade. Fremantle’s remaining suburbs grew by less than one percent with Beaconsfield actually retracting per annum by 0.3 per cent since 2008.
Since the end of the global financial crisis, Perth’s property values have moved just 3.5 per cent compared to Sydney and Melbourne that have grown more than 85 per cent across the same time period.
The rental market has stabilised with no change in median rents since April 2017 and with stock levels falling and demand improving, the rental market is often the pre-cursor to broader improvement across all markets.
Overall, the local market is slowly moving but will remain balanced for sometime before significant upward trajectory begins. In this market, you are buying at the bottom.
by Hayden Groves
REIA Deputy President