Land price rise stokes property positivity
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Land prices in Perth increased by 3.7 per cent in the June quarter, the latest sign of positive movement in the property sector, according to the Urban Development Institute of Australia WA.
The UDIA today said Perth’s average price for a block of vacant land was $232,348 at the end of June, up from $224,033 in the March quarter.
The increase put an end to three consecutive quarters of price reductions, the UDIA said.
UDIA WA chief executive Allison Hailes said the price increase was driven by a reduction in the number of lots for sale, with 9 per cent fewer blocks available on June 30 than on March 31.
“We are now seeing stock on the market return back to more normal levels, and in turn, a strengthening in values,” she said.
“Overall, Perth property is beginning to show signs of recovery and along with the positive economic reports released last week predicting broader economic growth for WA next financial year, we have every reason to be hopeful.”
Earlier this week, the latest data out from the Real Estate Institute of Western Australia indicated the established housing market had stabilised in the June quarter.
Reiwa said preliminary data showed Perth’s median house price was $500,000 for the three months to the end of June, down from $515,000 in the previous quarter.
However, Reiwa president Hayden Groves said there remained a significant number of transactions yet to settle for the June quarter, which would likely push that median price up.
“As with most quarters, this preliminary figure sits noticeably below the revised March quarter median of $515,000; but when we compare like for like, the June and March quarter preliminary medians are very comparable and show there has been little movement in median house price in the first six months of this year,” he said.
“Once all transactions have settled, we expect the revised June quarter median to increase to a level commensurate with the revised March quarter median.”
Mr Groves said sales activity was fairly consistent in the three months to June 30, a result he described as a welcome change from previous declining trends.
“Once all transactions for the quarter settle, we expect the final sales figure to lift just about 9,000, which will put it on par with the December and March quarter,” he said.
Sales listings declined by 5.2 per cent from the end of March to the end of June, a result Mr Groves said was due to steadily improving sales conditions.
“Although we still have plentiful choice in the market, we do appear to have hit a ceiling and are no longer seeing the increases we once were,”Mr Groves said.
“As long as transactions remain steady, we should see listing levels decline.”
While the Reiwa figures showed it took one day less to sell a house in Perth in the June quarter than in the March quarter, more than 54 per cent of vendors had to discount their asking price, by an average of 6.6 per cent.