07/08/2009 - 12:10

Perth house prices rise by $20,000

07/08/2009 - 12:10

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Sentiment in the state's property market is improving as the median house price in Perth increases by $20,000, according to final figures from the Real Estate Institute of WA out today.

Sentiment in the state's property market is improving as the median house price in Perth increases by $20,000, according to final figures from the Real Estate Institute of WA out today.

Also, in a new measure of market confidence, REIWA said it can now report on seller sentiment, which shows the proportion of sellers who are prepared to drop the asking price and by how much.

"Our seller sentiment indicator for the June quarter found that 70 per cent of sellers were prepared to drop the asking price by an average of 4.4 per cent to secure a sale," REIWA president Rob Druitt said.

"However, the declining trend in the number of sellers dropping prices suggests increased confidence in the market."

In final figures about the state of the WA property market, REIWA said the median price of a house in Perth increased by 4.6 per cent, or $20,000, to $450,000 in the June quarter, as compared to the March quarter.

Mr Druitt said the rise in house prices reflected the flurry of activity in the first home buyers market, which has a significant knock-on effect on trade-up buyers.

"Trade-up buyers generally need a first home buyer to buy their existing home, so they can sell and upgrade," he said.

"The current demand by first home buyers has therefore resulted in trade-up buyers storming back into the market.

"This means that an increased number of buyers are now purchasing more expensive properties.

"The result of all of this is that sales turnover is up by 60 per cent on the same time last year, while the number of properties for sale is down by 26 per cent over the same period."

Mr Druitt added that the increased activity had been very important in soaking up the excess dwellings built through the speculative construction boom of 2004 - 2007.

"Perth now has a much better balance between supply and demand with around 12,800 properties for sale at the end of June, down from 15,000 in March, and the number of selling days dropping from 76 in March to 70," he said.

The price of residential land in Perth grew by 9 per cent from $220,000 in the March quarter to $240,000.

Units and apartments also saw strong growth in the quarter, lifting nearly 9 per cent from a median of $349,000 to $380,000.

Meantime, the median rent price has remained steady at $360 a week while the vacancy rate climbs to 3.6 per cent.

In the regions, the median house price also grew, rising by 4.3 per cent to a median of $365,000, while regional unit prices rose a modest $5,000 to around $320,000.

The price of land in regional WA dropped by 3 per cent to a median of $150,000.

"Presently it looks like Broome, Karratha, Port Hedland and Esperance have all experienced an increase in activity, while Albany saw a modest decline of 3 per cent," Mr Druitt said.

"Karratha has been a real stand-out with 23 per cent growth in the quarter, while Kalgoorlie-Boulder and Geraldton-Greenough grew by 6 per cent.

"Greater Bunbury is also up 4 per cent and Mandurah-Murray by 3 per cent."

"The other notable feature in regional WA has been the increase in vacancy rates and falls in rents across the five largest regional centres."

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