The state’s strong economy and affordability factors have contributed to an optimistic outlook for the Western Australian real estate market, with sentiment among buyers, sellers and investors continuing to be positive, according to Realmark Managing Director and Founder John Percudani.
In this last edition of West Real Estate for the year, Mr Percudani provides a snapshot of 2021 and an analysis on the residential market for 2022.
As we move forward into 2022, price growth appears to be continuing – although at a moderated pace – while the affordability of WA houses remains attractive by comparison to other major Australian urban centres.
Listing levels continue to be low and the prospect of increased buyer and tenant demand looms with border normalisation.
“With more active and informed buyers in the market and pricing remaining positive, this summer is a smart time to sell with Realmark,” Mr Percudani said.
The December CoreLogic housing market update indicated a slowdown in housing price growth for WA as conditions created by the state’s firm border closures impacted the listing levels and population growth. This has led to a slight rise in the days on market, from 14 days in April to 24 days in November.
“It is our belief that once state borders reopen on February 5, 2022, WA should see the residential market resetting as interstate migration resumes, driven by lifestyle and employment demands,” Mr Percudani said.
Perth housing values grew only 0.4 per cent in the three months before November 2021, down from 7.7 per cent in March 2021.
“With value consolidation, potential sellers have increased equity in their current property, which is encouraging and enabling homeowners to consider an upgrade and purchase a new home this summer,” Mr Percudani said.
The upward trend in property prices has followed several cash rate reductions, an increase in positive market sentiment and an uptick in employment, particularly across the WA mining and agricultural sectors.
WA has seen fewer interruptions to economic growth from COVID-19 than other states and territories and, because of this, the unemployment rate has trended below the decade average at 3.9 per cent – the second lowest in Australia behind Darwin, according to additional December data from CoreLogic.
“At Realmark, we are often asked if summer is the right time to sell a home – there are more active buyers in the summer selling season,” Mr Percudani said.
“We know that with an increase in competing buyers, our sellers benefit from a better sale price for their property.”
While WA houses present exceptional value, consumer trends have been slowly shifting in 2021 with renewed demand for higher-density options, including apartments, villas and townhouses, particularly those with a lot of amenities or an exceptional location.
Affordability remains the main driver in this trend, with units and townhouses becoming more affordable. CoreLogic data revealed coastal and lifestyle locations have seen the highest annual growth rate across WA as homeowners seek a better location.
Mr Percudani suggested sellers of these various types of properties should consider bringing their properties to market and benefiting from the summer selling conditions.
“One note of caution to sellers, it is important to not always jump at the first offer,” he said.
“Ensure your property is not being put through a quick sales approach, as the data indicates properties sold off-market or first open may risk a lower sale price.
“It’s about delivering a smart sale – not just a fast sale.”
In the first edition for 2022, West Real Estate will delve further into market predictions for the year ahead from a number of WA industry leaders. Look out for this special report in the January 1 edition of the paper.