PERTH REAL REPORT
Watch this space Perth homeowners – according to The West, WA is facing a shortfall of around 20,000 homes within four years. This is expected to put continued pressure on the market, which was we all know is already HOT, and drive property prices up 📈
S T A T I S T I C S
✖️ An extra 150,000 people are expected to call WA home over the next 4 years (Source WA State Gov projections)
✖️ WA’s on track to build 56,000 homes over the next four years, but 78,000 are needed (Source REIWA)
✖️ There’s already a shortfall of 8,000 homes in WA (Source REIWA)
So, how high can prices go?
Well, for reference, in 2008 Perth and Sydney BOTH had the same median house price. Today…. Sydney’s median house price is $1.4 million with Perth’s is at $622,000.
2015 only 7 years ago the medium house price had broken the barrier of $500k which was a big deal back then. So it would be reasonable to think we may see another $100k or more in the next 7 years.
In 2023 the landscape has changed after 2019-21 Covid period of government spending to support the economy creating a post inflation condition nationally. Inflation in Australia has been rising, so much the reserve bank has used cash rate increases to curb the public spending which mortgages are at a 10 year high since 2012. Rentals are also at an all time high with stress on all leasing arrangements passing on costs of living. Its tough times for many using savings to make up the short fall in expenses exceeding income.
A few things are in play with public spending being too strong, mining is booming, selected sectors of business are in record returns, migration is back to pre Covid with thousands coming to live putting pressure on rentals & buying property to live. The old supply & demand basics of business which is the economy. Things are out of balance.
BUILDING B O O M & B U M P
Additional to all that is happening in the average Australian’s lives the new home builder is in a bit of a challenge. WA building industry is struggling to supply the same economical new build homes. With prices rising on goods & services up to 30% over the last few years. What was a $200k stylish villa or standard 4 bed 2 bath, double garage home is now near $300k. Normally 6-12 month build to a 18-24 months. Currently with 9,000 homes in the process of building ironically this could be tripled to 30,000 to get what is needed in private housing. But the actual delivery of the homes is the challenge as the new normal is costly a time consuming. This makes the property market more of a tricky place especially for investors trying to do fair deals that don’t leave them with over priced purchase needing a decade to get any basic appreciation. Developers, speculators are moving slowly which is the big players in the residential supply chain. Apartments, units, multi strata is the answer for below the medium price of $600k+. The $300k -$600k unit/villa/small home. Its a bump in the road that WA will get over but the bottom line is that more population means more business, more opportunity, the market goes up & down, ebbs & flows.
Like the old school Boy Scout or Girl Guide motto “Be Prepared”
GET ADVICE !
Now more than ever BE AWARE !
Buyer, Sellers, Builders there is help !
A new service in WA is the Property Scouts which are a team of Buyer, Seller, Builder . Assist in the search & securing of a property in a professional manner. Being your guide, representation, trusted advisor. Being the sales & marketing specialist
BUYER AGENT is a MUST
Its quite normal for a purchaser to go blind into the property market looking at homes, making personal judgements, comparisons, asking a family member or friend for buying advice. This is a recipe for disaster maybe not in the short term but your buying the future of the home not & the past. Houses are a depreciating item, degradation with age, have a value that is variable based on the property condition. Rarely does a buyer consider future maintenance, restorations, repairs.
Sellers have an agent on their side of the deal that provide full reporting on comparable sales evidence, strategies of the sale, staging, presentation tricks, scripts & dialogues for selling, professional negotiation skills, documentation knowledge, offer & acceptance terms, conditions, legalities.
The easier it is to sell a property the less the owners need to do for the property to transact with potential underlying issues not known on a couple of viewing before offer is made. In most case these are discovered after the sale then its too late. If its not structural or pest intersections are cleared. Then you will buy any future issues, problems that may be a year or two away from needing attention.
Be smart, be savvy on spending, do your due diligence, take the time to do a property house check. Get professional advice it will save tens of thousands in costs along with a stressful long term experience. Pre-purchase advice, property checks, post purchase report prior to settlement to protect the integrity of the purchase.
REAL DEAL REPORT
Pre purchase Valuation, Property Condition, maintenance, dwelling services, degradation, health of home which includes additional tests for water, air, dust, roof, foundations, soil. Streetwise Live Safe report on neighborhood.
BUY or SELL
This feature supported by
Real Deal Australia : Mitchell Residential