Property investors believe Perth has the strongest potential for growth of any capital city in Australia during the next three years, according to a new national survey.
The finding is the key takeaway from a survey conducted by property investment group Momentum Wealth, which quizzed 401 investors across the country.
More than 60 per cent of respondents said Perth had the highest growth potential of any market in the next three years, while 37 per cent of respondents said it had the most potential over the next 12 months.
Momentum Wealth buyers agency team leader Emma Everett said Perth’s combination of affordability, improving rental conditions and positive economic indicators were driving factors behind the increased confidence.
The survey comes after a series of data releases that have reflected a positive outlook for Perth residential property.
Last week, the Australian Bureau of Statistics revealed a rise in housing finance commitments in Western Australia, both in number and in value, up 4.5 per cent and 3.8 per cent in the December quarter, respectively.
That data followed a 3.6 per cent increase in housing approvals in WA in December, according to the ABS, while the Housing Industry Association recently reported a 14.4 per cent lift in new home sales in the three months to the end of November.
Last month, the Real Estate Institute of Western Australia said vacancies had continued to fall in the residential sector, down to 2.4 per cent at the end of December, with 5,616 properties available for lease down 18 per cent on the same time in 2018.
“Continued improvements in rental conditions and a significant tightening of stock in Perth’s housing sector are now driving the consensus that the property market is moving into recovery phase, with savvy investors realising the counter-cyclical opportunities at hand,” Ms Everett said.
“At the same time, longer-term indicators such as rising activity in the mining sector, increased infrastructure spending and early signs of accelerated population growth in Perth are providing healthy indicators for the market’s future performance, with the latter in particular expected to drive higher levels of demand in the medium term.”
While sentiment has risen in Perth property circles, the Momentum Wealth survey also found that access to finance remained a barrier to entry.
The survey showed 39 per cent of respondents considered a lack of equity or borrowing issues as impediments to realising short-term investment opportunities.
Momentum Wealth finance team leader Caylum Merrick said while buyers saw Perth as a good investment option, some investors were not in a position to make an immediate move as it was difficult to build equity in a soft market.
“Investors who are lacking the equity to progress should focus on debt consolidation strategies, as well as reviewing their existing lending solutions for potential opportunities to reduce repayments,” Mr Merrick said.
