Where next for Perth’s property market: expert predictions
Following several challenging years for Perth’s property market, improving conditions across the rental and sales market saw signs of an emerging recovery in the early months of 2020. Despite the latest disruption caused by COVID-19, the Perth market has shown resilience throughout the pandemic, with tightening stock levels and rebounding buyer confidence positioning the market well for future improvements. In fact, a growing number of industry experts are beginning to take notice of Perth’s progress, and many are predicting positive things for the Western Australian capital. So, what are some of their key projections?
Bill Evans, Westpac Chief Economist
Westpac chief economist, Bill Evans recently revised his outlook for Australia’s property markets after resilience in capital cities throughout the COVID-19 pandemic was stronger than expected. While reducing his national downward projections, Mr Evans now predicts a surge in property prices from June 2021, with Perth at the forefront of these gains alongside Brisbane with a forecast increase of 18 percent.
“This recovery will be supported by sustained low rates, which are likely to be even lower than current levels; ongoing support from regulators; substantially improved affordability; sustained fiscal support from both federal and state governments; and a strengthening economic recovery,” Mr Evans said.
Terry Ryder, Property Researcher
Experienced property researcher and commentator, Terry Ryder, shares the sentiments of Mr Evans and predicts strong performance from the Perth market in the coming years.
“The Perth market has shown greater resistance to the pandemic than most Australian markets in terms of sales activity,” Mr Ryder said.
Mr Ryder says the Perth market has been buoyed by relative freedom from COVID-19 restrictions, increasing first-home buyer activity thanks to government support, and near record low vacancy rates causing upwards pressure on rental prices.
“Perth has become the most affordable of the Australian capital cities so it’s a great time to be buying there as a first-home buyer and as an investor”, said Mr Ryder.
Mr Ryder’s comments were echoed by renowned demographer, Bernard Salt, who believes “Perth is the right place for the moment” and predicts a property boom will persist through “the first half of the 2020s”.
Jason Murphy, Economist
Economist Jason Murphy is another leading figure who believes the Perth property market is set to make a positive turn thanks to a mix of factors ranging from the state’s response to the COVID-19 pandemic, an increase in mining activity and the overall liveability of the city.
“As the world recovers from the coronavirus, iron ore and energy exports are likely to pick up again, which spreads wealth throughout the state of Western Australia”, Mr Murphy said.
“The mining boom is not what it was admittedly, but iron ore prices are still above US $100 a tonne, which is historically very high”.
Mr Murphy also touched on the affordability of the Perth market, which he said offers prospective buyers much greater value for their money compared with the Sydney and Melbourne markets.
“The downside risk of a Perth house purchase has to be quite low, and that has to be attractive in our current era where nobody is sure what will happen next”, Mr Murphy said.
The Perth market has remained resilient over recent months and looks well poised for strong gains over the coming years. The State’s effective response to the coronavirus pandemic, low stock levels, and rebounding buyer confidence all signal positive change for the local market, with a number of suburbs already experiencing these improvements. Combined with WA’s relative affordability, these conditions are bringing unique opportunities for local and interstate buyers in a position to enter the market.
For more on-the-ground insights into the latest data and opportunities within Perth’s property market, check out our recent article on why astute buyers are looking towards Perth.