Perth Residential Market Insights – September 2020
Perth Sales Market
17th consecutive week exceeding 700 sales
Sales activity in the Perth residential market continues to track consistently, with sales exceeding 700 transactions for the 17th consecutive week at the close of September. These improvements have been seen across both the house and unit market, with land sales also remaining strong off the back of increased demand thanks to recent government subsidies. Overall, sales activity in September was 47% higher than for the same period 12-months prior.
Competition heating up on the ground
Increased sales activity, combined with tightening stock levels (sales stock was 22.2% below levels seen in September 2019 ), is presenting promising conditions for market growth. Our buyer’s agents are noting increased competition at home opens, with demand beginning to outstrip supply in a number of tightly held suburbs. While core suburbs have already been experiencing these improvements for some time in the form of positive price movements, these conditions are now starting to influence headline growth figures, with Core Logic’s home value index highlighting a 0.25% monthly increase in property prices across September.
Perth Rental Market
Stock on market drops below 3,000
Rental stock on market dropped to below 3,000 in the week ending September 27, and remained below that mark for the final week in September. This is the first time in eight years that rental stock has fallen below the 3,000 mark and represents a 52.4% decrease in properties for rent compared with the same period last year (REIWA). This sustained tightening in available rental stock, further accentuated by low building approval numbers and limited new rental stock coming on stream, has seen vacancy rates fall to a 12-year low at 1.3%, with tenant competition increasing as a result.
One in three suburbs experiencing rental growth
With rental stock continuing to dwindle, the average days to lease have also fallen considerably. It took a median of just 19 days on market to lease a property in the Greater Perth area during September – the shortest it has been since June 2013 (REIWA). Despite the emergency moratorium on rent increases being extended until March 2021, one in every three Perth suburbs experienced an increase in rent during September. Our property managers are seeing increased competition at viewings and we anticipate this will translate into broader rental growth once the emergency period residential tenancies legislation expires at the end of March next year.