Perth’s landbuying frenzy is being felt in regional Western Australia, with real estate agents reporting blocks have been selling like hot cakes.
In late June it was revealed Greater Perth had experienced its biggest spike in land sales since 2013, following the rollout of Federal and State Government homebuilding grants to stave off the effects of the COVID-19 pandemic.
Ray White Nannup Principal Mike Tucker said his local property market was quite strong prior to the economic closures introduced in March and had actually reaped unexpected benefits from the health crisis.
“Prior to COVID-19, a number of strong economic factors meant prices were at their best value in a long time,” he said.
“In saying that, the pandemic has made big differences to us, including creating a new set of clients.
“We’re seeing far more tree-change buyers, younger couples and retirees.
“Many people were considering buying land in Nannup before the pandemic and have now just had the decision cemented for them.
“The homebuilding grants have also helped effectively close the gap in costs between regional and metropolitan landbuying, so there’s been a big benefit with it being much cheaper.”
Mr Tucker said buyers were attracted to the cheap price tags and large block sizes in Nannup, along with easy access to amenity-heavy regional centres.
According to the agent, the average price of a residential block was about $90,000, which would get buyers more than 1000sqm of land with quality soil.
This is roughly triple the size of the 375sqm median in Perth, which the Urban Development Institute of Australia’s State of the Land 2020 report found to be the smallest median in the country.
Mr Tucker said the value for money was really turning heads.
“And with work-from-home measures, many people are starting to realise they don’t necessarily need to live in Perth and be close to a city office,” he said.
“If you’re only really going in for meetings nowadays, do you really need to prioritise being within 10 minutes of the CBD?
“There’s great value buying out this way and, with lots of sales activity, the market is reflecting that.”
Despite an upswing in landbuying, a mixed bag has been recorded for home sales in the regional property market, with the Real Estate Institute of WA reporting a substantial reduction in listings across all nine regional centres in the June 2020 quarter.
The largest contractions were a 36 per cent fall from March in Karratha, which left only 34 properties on the market, while Albany, Kalgoorle-Boulder and Port Hedland recorded 29 per cent, 28 per cent and 26 per cent declines respectively.
Geraldton and Busselton each dropped 22 per cent, Broome by 13 per cent, Bunbury by 11 per cent and Esperance dipped by seven per cent.
Overall, WA recorded a 17 per cent dive in listings, was left with a $320,000 median sale price and did not experience a rise in sales.
“Usually when there is a decrease in listings we also see a spike in sales, however, only three regional centres saw an increase, including Karratha (up 72 per cent), Port Hedland (up 24 per cent) and Geraldton (up 15 per cent),” Mr Collins said.
“There could be a few reasons why we are seeing activity and listings reduce in other regions, including prospective sellers choosing not to sell their property during elevated levels of uncertainty around the impacts of COVID-19.
“While it is pleasing to see five regional centres either saw an increase in median sale price or remained the same, the areas that did decline did so only slightly, with Kalgoorlie-Boulder declining the most by 4.4 per cent.
“Despite the uncertainty around what is expected to happen during the COVID-19 pandemic, the results we have seen during the June 2020 quarter when the outbreak was prominent in WA are quite pleasing for all regional areas and should provide those people looking to buy or sell with confidence that the markets are holding up well.”