– Why buyers and sellers alike are missing out.
We have just been through some fantastic times if you own a property. Property prices have gone up by 1.1% in April alone and REIWA is expecting a 10% growth across the 2022 calendar year. However, you now have banks like Westpac, who don’t think that we are going to see any growth for the rest of the year. So who is right?
For my take on the Perth property market in 70 seconds view my video update below.
My prediction is that we are going to be steady for the rest of the year.
It might go up a little bit. It might go down a little bit but it’ll be remain reasonably steady. So in other words it’s going to be the same as what we have now, at least for the short term. And the reason for that is that we hardly have any properties for sale. We are probably about 30% under what we usually have for sale with a balanced market. Furthermore, the rental market is really really tight with a vacancy rate of about 1.1 – 1.2%. A balanced market is around the 2.5-3%.
Where are the buyers coming from?
On top of that, investors from interstate are still very keen on our property market because Perth is the most affordable capital city right now. We also have first home buyers who do not want to pay the high rents that they’re paying already and building from new is now really difficult with ongoing price increases and delays.
Then there is the recent interest rate increase. If you’ve followed the RBA change and the media reporting in the past couple of days it’s all probably doom and gloom usually because that gets peoples attention and it therefore sells advertising. However, we will get interest rate rises again this year. There’s no doubt about it. You can just look at what just happening in the US increasing their rates from 3% to 5% in the past 6 months.
As such, I do believe that 2022 is the last year we’re going to see any growth in Perth market. I expect that the brakes are going to come on towards the end of the year and will likely see a negative growth for next year which is supported by Westpac who are expecting a 6% drop for 2023. However, it will not be as bad as what you’ll see in Sydney and Melbourne. Also, remember when you’re reading the media updates that they’re reporting mainly on Sydney and Melbourne market conditions, not Perth. We are not the centre of the universe by far according to the national media. We are probably the opposite.
So that means in a nutshell that it’s going to stay roughly the same this year.
Why buyers and sellers alike are missing out.
Talking to buyers every day, what I am constantly hearing, is so many of them have the same story to share. They keep missing out on properties because they simply don’t know what price to offer. The lack of transparency is extremely frustrating for the buyers and sellers are also missing out as they are not receiving the best possible price for their property. I’m really struggling to understand why transparency is not happening because it is so easy to address.
The good thing is my clients automatically receive that transparency as it is a standard service that we offer which means that we get some fantastic results for our clients.
Would you like to know what your Perth property (home or investment) is worth?
Whether for planning, financial management, an additional mortgage or just peace of mind, decisions made with anything less than the facts can lead you to make choices that may not be in your best interests.