Within Perth itself, the June 2019 quarter saw increases in activity from the extreme ends of the market as the sub $350,000 and above $3 million price brackets improved the most.
The overall median rent rose to $350 per week in the June 2019 quarter. This equates to a $10 increase in both the median house and median unit rent, now $360 and $330 respectively.
The rental sphere has continued to be a strong performer over the past two years.The number of days to lease decreased by one day to 41 days in the June 2019 quarter. According to the REIWA, 54% of greater Perth suburbs saw an increase in leasing activity in July.
Remembering the lag between rental increases and median house prices, we expect that Perth may experience a similar, albeit smaller property market cycle in the coming years. Australia wide, a $75 billion resources construction boom is underway.
Within Western Australia, several new iron ore mines are either currently in the early stages of construction or have recently been announced to commence construction and the activity in the lithium industry is still top of mind.
On top of this the Western Australian Government has apportioned a significant budget to the Metronet infrastructure project over the coming years with nearly $8 billion of funding allocated to road and rail expansions, level crossings and inclusions for the Morley-Ellenbrook line and the Byford Extension on the Armadale line.
Job vacancies are starting to rise again, and we expect wage growth may slowly increase as a result.
REIWA’s President Damien Collins recently said that… “while the market has been declining for some time, the economic conditions in Western Australia are looking far more positive than 12 months ago. I would advise those who are thinking about purchasing their first home, trading up or investing, to act soon and take advantage of current conditions before the market starts to recover and prices inevitably rise.”
Our thoughts and predictions definitely align with Mr Collins as affordability is arguably the best it has been for a long time.
Source: Herron Todd White