Posted on Tuesday, February 2nd, 2021 in by Matt Garmony
The Perth residential property market is improving as we start 2021. There is increased buyer activity, building activity is booming and the residential vacancy rate is at an all-time low.
REIWA (Real Estate Institute of Western Australia) reported on 4 January 2021, there has been a “significant increase in buyer activity” in December which is traditionally a quieter month. Although Perth Median House Price remains stable at $480,000, REIWA reported “December sales saw 3067 transactions for the month which is an increase of 42.5 percent when compared to the same time last year.” REIWA further reported on 1 February 2021 that “Perth’s median house price increasing to $490,000 in January.” Corelogic’s Perth Home Value index data showed a 1.6% increase in January 2021 and 3.8% in the last three months, making Perth the fastest growing market in Australia.
The Perth residential rental market is also continuing to grow, with the WA Business News reporting that “Domains latest rental report found house rents increased by $25 to $420 a week during the December quarter, as available properties continued to dwindle in what has quickly become a landlord’s market.”
Low Interest Rates Continue
With a low interest rate environment, strong demand for rental properties and rising market values, we expect demand for homes and home units from residential investors, which should sustain price growth in 2021. At the Reserve Bank of Australia’s (RBA) Monetary Policy meeting on 2 February 2021, RBA Governor, Phillip Lowe, decided to keep the Cash Rate at a record low 0.1%, indicating whilst the global economy outlook had improved, the path ahead “is likely to remain bumpy and uneven.” With current inflation and wage growth well below the 2-3 percent target rate, interest rates will remain low.
The WA Business News, also reported on 18 January 2021 that “Western Australia recorded the largest improvement in building approvals of all states, underpinned by government stimulus measures and first home buyer demand.” Our licensed valuers are of the opinion this has been a major stimulus of the Perth Residential property market improving.
Even as Perth enters a 5 day COVID-19 lockdown from 31 January 2021 to 5 February 2021, it is anticipated the Perth residential property market with continue to improve. If you require assistance or advice for pre-sale or pre-purchase valuations, please contact the licensed valuers at Garmony Property Consultants.