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New season puts a spring in Perth’s property market despite shortfall


October 10, 2018 by admin

While there is movement in Perth’s property market, this spring is starting with a shortfall in properties listed for sale.Perth’s property market is running low on homes to sell as it heads into the traditionally busy spring period, putting price rises on the horizon.

Warmer weather and the end of the football season has historically seen a flurry of people wanting to sell or buy property and after three years of a sluggish market Perth real estate agents are predicting this will be the best spring for some time.

“When the sun’s out, the flowers are out [and] people decide around spring time ‘let’s make a move’ [in the property market],” Professionals Real Estate WA chief executive David Hobbs said.

“In winter people hibernate, they ride out the cold and wet. It really is a good time for real estate agents [in spring].”

Activity increased by one-third during spring, Mr Hobbs said.

“Sales will be up dramatically, there’s no doubt that there is real movement in the market now,” he said.

“We’re seeing records in a couple of our offices.”

Australia Property Monitors senior economist Andrew Wilson said while last spring was flat due to an “affordability hangover” the next few months would be the best in several years.

However, unlike last year, this spring is starting with a shortfall in properties listed for sale.

There were only 10,700 properties – including houses, units and land – for sale as of yesterday, according to the Real Estate Institute of WA.

About 12,000 is considered to represent a healthy market.

Listings were at 17,000 only 12 months ago and reached a peak of more than 18,000 in May 2010.

Ray White WA chief executive Mark Whiteman said the city was at risk of not having enough stock as more buyers become interested.

“We’re listing at least as many properties as we’re selling,” he said.

A survey of Perth real estate agents revealed suburbs likely to have the most activity this spring are those along transport corridors, near train stations, in the inner city and a few kilometres from the coast.

Homes priced in the lower to mid price range also would be more popular as buyers remained cautious at the top end of the market.

“[The market] is still very price driven and price sensitive,” Realmark Real Estate principal John Percudani said.

“There’s strong investor activity in the apartment sector, in particular in the CBD and inner city.

“I think you’re going to see a lot more activity in areas such as Pearsall, Kingsley and Padbury in the north. They’re areas that provide very good value for money.

“South of the river, Willetton and adjacent suburbs are still very attractive.”

Mr Percudani said buyers were facing living cost pressures and were now enquiring about costs beyond the property purchase.

“People are very focused now on the cost of living, so proximity to community facilities, transport … rates and utilities … have been a big focus in terms of overall affordability of the home.

“What type of heating and cooling is in that home? Has it got an expensive pool to heat? Does it have a lot of garden or is it economical?

“All those running costs of the home are of high consideration, particularly in the medium [price] point of the market.”

Mr Percudani said cost of living also was influencing buyers to favour inner city areas over outer suburbs.

Harcourts chief executive officer Stuart Cox said coastal suburbs typically did well during spring but this year suburbs set back a few kilometres would fare better because they were close enough to the beach without costing a fortune.

Cockburn Central, with the new Fiona Stanley Hospital, shopping centre and apartment complexes, also was very active.

Mr Whiteman added Belmont, Rivervale, Mt Lawley and North Perth to the list of suburbs expected to have a busy property season this spring.

Mandurah and Rockingham also would pick up, he said.

While competition among buyers for the few properties on sale threatens to push up prices, the industry is not expecting any significant rises for the next six months.

“We may start to see, as sales move up … the median price range will rise [but] that’s only because we’re starting to see a few more sales in the top end,” Mr Whiteman said.

Dr Wilson said spring often encouraged buyers at higher price points, which drove up the city’s median price, causing a statistical anomaly.

“[Perth property prices] rose 1.7 per cent in the first six months of this year and we’d expect that to continue and that sort of momentum to build on through the remaining of this year,” he said.

“This will probably be the best spring market for the last few years.”Comment at WAtodayFollow WAtoday on Twitter

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