IT’S well known that Perth has experienced something of an inner-city boom in the past five years.
In fact there has been a 50 per cent increase in the number of inner-city apartments in that time, with the inner-city population reaching 11,000 at the end of 2002.
It has, however, taken longer for a true ‘inner-city lifestyle’ to develop on the streets and in the establishments of Perth.
Unlike Sydney or Melbourne, Perth historically has never had a large population of inner-city dwellers and, as a result, much of the infrastructure that goes with the presence of an established resident population has been lacking.
Inner-city areas have faced the catch 22 situation of not having enough people to attract the type of businesses that give life to inner-city areas, but also not having enough life to attract significantly more people.
However, this scenario may be nearing an end with the population of inner-city and near inner-city areas reaching a critical mass, both to attract and support the establishment of new businesses such as restaurants, bars and grocery stores.
More cafes, restaurants, bars and convenience/grocery stores are setting up shop in inner-city locations, creating that inner city ‘buzz’ and convenience many former suburbanites have moved there to enjoy.
Blackburne and Joyce Property Group sales and marketing manager, Paul Blackburne, said that as more entertainment and hospitality businesses were established more people would be attracted to the inner-city as a place to live.
With the vacancy rate sitting at a stable 4 per cent, Mr Blackburne said rather than creating an oversupply, an increasing supply of good quality inner-city apartments could cause a “demand pull”.
There was little quality inner-city rental property on the market currently, he said. A reversal of this situation would attract more people to the inner-city to live.
“There is a fair few properties on the rental market, but not so much that the market can’t handle,” Mr Blackburne said.
“Perth has reached a critical mass. When you start to get enough apartments and people have somewhere to live, things start to happen.”
Five years ago the majority of apartment buyers he dealt with were in the middle age bracket, he said.
“Now it’s everybody – divorced wives, 22-year-old guys who are trading by buying off the plan and selling on, a lot of baby boomers who have tired of the bad performance of the stock market and superannuation and have got all their money out and want to put it into something else,” Mr Black-burne said.
According to Real Estate Institute of Australia there were 2,230 unit sales in Perth in the March quarter of 2001, 25.4 per cent up on the previous quarter. Almost 75 per cent of these sales occurred in inner suburban areas, including areas covered by local authorities of Stirling, Vincent, Cambridge and South Perth.
Mr Blackburne said the Perth inner-city property market had good medium to long-term prospects with stable capital growth.
“We never saw what happened in Sydney and Melbourne,” he said.
“Being scared of oversupply is helping the market here, damping it down to ensure supply is sustainable.”
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