16/07/2009 - 00:00

New price change index to track trends

16/07/2009 - 00:00

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ONE of Western Australia's biggest real estate groups has launched a new index to track market trends because it says median house prices do not accurately reflect Perth's property market.

New price change index to track trends
BROAD SCOPE: David Hobbs says median house prices don’t accurately reflect the market, and the new index will show overall property trends. Photo: David Bradley

ONE of Western Australia's biggest real estate groups has launched a new index to track market trends because it says median house prices do not accurately reflect Perth's property market.

Professionals Real Estate Group chief executive David Hobbs said the company was launching the index to provide a more accurate illustration of property trends across the WA real estate market.

"While most property indexes quote median prices for houses and units separately, the Professionals' Property Index (PPI) captures average price changes across all dwellings to provide a more accurate snapshot of where the market is at," Mr Hobbs said.

Mr Hobbs said the PPI used the most recent monthly sales information across 200 WA suburbs supplied by RP Data.

The Professionals ranked second in the WA Book of Lists residential real estate sector, after Ray White Real Estate. The ranking is based on staff numbers in WA.

Mr Hobbs said recent sales growth indicated WA's real estate market was on its way back up after the downturn of the past 12 months.

"As long as interest rates don't have a ridiculous increase, I think we'll start to see movement in the marketplace," he said.

"The best interest rates in 40 years have been a driving factor, there's no doubt about that.

"But what we've found is that the first homebuyers are starting to dry up and investors are starting to come out of their shells, so we're starting to see some movement."

According to Mr Hobbs, the continued expansion of resources projects in WA has been a driving force behind the Professionals' growth.

"We're very strongly represented in regional WA, and anywhere that's surrounded by resource projects is doing exceptionally well," he said.

"Any regional area that is reliant on tourism is struggling; areas like Margaret River and Dunsborough, a lot of these places that are dependent on tourism, they're the ones that are finding it most difficult and that's where the greatest decrease in property has been."

But Mr Hobbs predicted the market could slow after the first homebuyer grants cease at the end of this year.

"There will be a slowing of the market for a little while but as we're seeing now, investors are starting to move I think the market will even out," he said.

"I think we'll even start seeing those second and third homebuyers coming out and starting to move in the marketplace.

"Some of the buying patterns we're seeing now are a lot of parents wondering whether it's going to be affordable for their children to buy a home. We're seeing mums and dads investing in second and third properties so down the chain they can help their family."

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