WA MARKET OVERVIEW
WESTERN AUSTRALIA
WA Market Overview with Luka Marinovich
Reflecting on the last 6 months, what were some of the prevailing trends that you noticed and how did they play out in the market? The last six months has seen higher than normal cost of living pressures, continued interest rate rises and stubbornly high inflation figures. Despite this Perth has achieved a record high median price of $560,000 however this remains the lowest median price of all state capitals and the only capital city to record a moderate price growth. Marketwise, what are you forecasting for the second half of 2023 and how will increased lending costs impact the various markets? Continued growth given the 2023-24 WA State budget expects the economy to grow in the vicinity of 4.25% and a forecasted 3.3 billion operating budget surplus. Supply issues with property listings remain a challenge falling to a 13 year low with just over 5200 properties listed for sale compared just over 8500 12 months ago. Perth is in a very unique situation compared to other states due to our strong economy, the nation’s lowest unemployment rate, lower than average mortgages and higher than average wages. Although the increased lending costs have undeniably affected household expenditures, a significant number of individuals who hold existing mortgages have managed to adapt to heightened repayments. However due to higher lending costs new buyers entering the market have seen a reduction in their borrowing capacity. Not surprisingly all the Top 10 fastest selling suburbs were well below the Perth median house price and half of the suburbs in the Top 10 for unit price growth were under the median unit price.
LUKA MARINOVICH Property Partner The Agency
What market sectors do you anticipate being most in demand over the next six months?
Perth’s property market has been driven by houses. Recent growth in home values has been supported by a recovery in the mining sector, the nation’s lowest unemployment rate, strong jobs growth, and a 2.3% growth rate in migration. Buyer focus over affordable housing has seen the current Top 10 fastest selling suburbs all boasting prices significantly below the median house price with this trend likely to continue into 2024. Although Perth has been slow to react the Build to Rent (BTR) sector it has gained momentum after the unveiling of the Federal Budget in May, it was declared that starting July 2024, foreign investors associated with managed investment trusts will qualify for a reduction in the withholding tax rate pertaining to BTR ventures. This adjustment will be applicable under the condition that
100 – August / September 2023
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