A Month to Remember

A particularly noteworthy month was November. The month broke a three-month trend where housing values were dropping. Perth and Darwin were the only cities to remain stable and steer clear of a decline in sales through the month. This was in keeping with previous years where November has traditionally seen a spike in property purchases.

Buying.

The median house price grew by 10% during 2021/22, reaching $665,000 as of June 2022. The Perth unit market has remained firm over 2021/22, rising by only 3% to $436,000. The growth in both areas can be attributed to factors such as the reopening of borders (domestic and international), housing affordability, and a strong mining sector state-wide. Low unemployment rates in WA (as low as 2.9%) in 2022 have resulted in a thriving jobs market, which has also impacted house prices.

While it’s true that this median price is still out of reach for many homeowners — particularly first-home buyers — Perth has actually recorded the lowest median house value of any capital city in Australia. And, Perth holds the second-lowest median unit value (following Darwin). The reality is, most home buyers are second or third-home buyers (or more), and the median price is very attractive for these audiences.

Renting.

It’s no secret that the Perth rental market has been extremely competitive this year. SQM Research reflects this, showing the vacancy rate in Perth is at 0.4% — the lowest since the series began in January 2005. Many investors have jumped at the opportunity to increase rental prices and make the most of a scarce rental market. On the other hand, it’s meant that many renters have had to relocate in order to find affordable housing, or are pushing their financial limits with pricey rentals.

In June 2022, the median weekly rent for a unit-apartment was $451, just below the Melbourne median. What makes this particularly alarming is that the median Melbourne unit sells for 53.2% more than the median apartment value in Perth… In September 2022, the median rent

al price for a house was $495 per week — an annual change of 10%.

Perth’s most popular suburbs.

2022 delivered a real mixed bag of in-demand suburbs. The list, established by Domain, includes no-brainers such as Trigg and South Fremantle, as well as surprise suburbs like Gidgegannup and Leschenault. In fact, the small Gidgegannup township came out as number one. Sitting 40km north-west of Perth, properties here are mainly acreages and semi-rural properties, along with some new house-and-land developments.

Future Perth property trend predictions.

Buying.

While the median unit price is expected to rise by 3% to $459,000 by 2025, the median house price is expected to remain mostly where it is now (currently $665,000) by 2025, save for a small 4% rise expected in 2024/25. If the prediction is accurate, the house price will sit at $679,000 in June 2025.

Renting.

Now that state and international borders are
open, WA has seen an influx of overseas migration, which is already
contributing to temporary population growth. Those migrating are mostly heading
to the mining sector workforce, and this is expected to drive the rental market
over the next three years, especially in units.

While this mainly impacts renting in regional mining areas, Perth will also benefit from the return of overseas students. These students will greatly impact the Perth suburban rental market.

Predicted in-demand suburbs for 2023.

The forecast for in-demand suburbs? It depends who you ask.

According to Perth Property Analyst Gavin Hegney, Northern coastal suburbs from Yanchep to Two Rocks, Mt Lawley, Mosman Park, Fremantle, Kwinana, Rockingham and Perth Hills are set to show strong growth over the coming years.

On the other hand, Trent Fleskens of Perth property Group says Heathridge, Mullaloo, Ocean Reef, Morley, Willagee, Nedlands, Parkwood, Coolbellup, Halls Head, Wembley and Subiaco are suburbs to get into. Another Perth property expert simply stated it’ll be all suburbs within a 15km radius of the city, with some coastal highlights sprinkled in.

Whilst we can predict what suburbs will be favoured and enjoy a property boom over 2023, we’ll have to wait until its nearly 2024 to see how it has all played out!