After months of negative commentary on falling house prices and rising interest rates in Australia, Realmark managing director John Percudani has issued a timely reminder that the West Australian market does not reflect the trends of the property market nationally.
While not immune to the economic forces effecting all Australians, he remains optimist and has flagged a potentially strong 2024.
“Forecasting the real estate market is always difficult but recent data suggests that WA will, likely, evolve differently from most of the Australian market in the coming months,” Mr Percudani told The West Real Estate.
“The WA market currently demonstrates strong buyer and tenant enquiry levels, and solid demand, which is not the case in the east coast market.
“This demand and supply dynamic favours the seller and is underpinned by a confident sentiment and employment security, leading to positive price realisations in most sectors.
“However, the rising cost of money and tightening lending criteria pose a challenge to this dynamic.
“The impact of interest rates is evident in other Australian property markets and it may potentially be felt more in WA in mid-2023.
“Nevertheless, the underlying strength of the WA market may potentially result in an upside in 2024.”
Mr Percudani also warned of the dangers involved with trying to predict the property market.
“While a positive outlook seems reasonable to expect, unforeseen factors may appear, so cautious optimism is warranted.”
CoreLogic Asia-Pacific executive research director Tim Lawless said Perth’s housing market has been the most resilient to falls since interest rates started to rise.
“Perth housing values are still very affordable, at least in relativity to the other capitals – with a median dwelling value of $567,111, Perth has the second-lowest median after Darwin,” said Mr Lawless.
“The amount of time it takes to save a 20 per cent home loan deposit is the lowest among the state capitals at 7.7 years – compared with 12.8 years in Sydney – and the portion of income required to service a new mortgage is the lowest among the state capitals at 30.7 per cent.
“The blend of affordable housing prices, low supply, high demand and strong economic conditions is, generally, a positive recipe for housing values.”
For the full story, see The West Real Estate liftout in Saturday 2 April edition of The West Australian.
