Perth Residential Market Insights – January 2021
Perth Sales Market
Perth currently Australia’s fastest growing major market
Data from CoreLogic has highlighted that Perth is the fastest growing major market in Australia after a 1.6% increase in their Home Value Index during January, a 3.8% lift compared to three months ago. Data from REIWA supports this growth with their research showing that during January, Perth’s median house price increased to $490,000.
Investors returning in pockets
Investors are beginning to return to the market and competition on the ground continues to heat up as buyers look to benefit from forecast growth conditions. The hot market and high levels of competition are creating a great sense of urgency amongst buyers. However, not all property types and areas are poised to benefit from these conditions equally, so it’s important that prospective investors remain focused on underlying growth fundamentals during their property research and selection process.
Our buyer’s agency team were at a home open recently that had 60 interested parties view the property. The real estate agent was asking for offers from $505,000 and the property received 15 offers before selling for $625,000 cash. Interestingly, three of these offers were from interstate investors who were looking to buy sight unseen. On this occasion, our buyer’s agent decided to not place an offer. What a lot of buyers, both local and especially interstate, didn’t realise was that there were several local area factors negatively impacting the property.
Perth Rental Market
Median rent rising
CoreLogic’s Quarterly Rental Review (Q4 2020) revealed Perth to be the fastest growing rental market last year. This growth has continued into the new year as REIWA report the median rent in Perth has once again increased by $5, up to $400 per week for the month of January. This rental growth is forecast to continue as the year progresses with sustained low stock levels and heightened demand from tenants placing upwards pressure on prices.
Rental stock remains at near-record low
The month of January ended with rental stock remaining at near-record lows – only 2,787 properties were available for rent during the last week in January, and this now marks five consecutive months of rental stock levels sitting below 3,000. For comparison, rental stock levels are -51.7% below where they were 12-months ago, highlighting just how much the market has changed in that period.