11/04/2008 - 06:18

Perth median house price slides as listings soar

11/04/2008 - 06:18

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The Real Estate Institute of Western Australia data released today show a fall of almost three per cent on the median house price for the March quarter, pulling it down from $470,000 at the end of last year to around $457,000 currently.

Perth median house price slides as listings soar


The Real Estate Institute of Western Australia data released today show a fall of almost three per cent on the median house price for the March quarter, pulling it down from $470,000 at the end of last year to around $457,000 currently.

 

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Perth experienced a fall of almost 3 per cent on the median house price for the March quarter,
according to preliminary data released today by the Real Estate Institute of Western Australia.
The REIWA data shows a fall of 2.7 per cent on the median price, pulling it down from $470,000 at
the end of last year to around $457,000 currently.
REIWA President Rob Druitt said the retraction in price was caused by a combination of factors
including interest rate rises, a drop in overall consumer confidence and a record number of listings
now on the market.
"Some of this price reduction can be attributed to a small increase in the number of properties
being sold at the more affordable end of the market at the expense of premium sales which have
slowed. This has skewed the results a little," Mr Druitt said.
"More importantly, given the flatness in much of the local real estate market following the boom,
many investors are withdrawing from Perth property and putting their homes up for sale.
"This has seen the number of listings grow from around 5,000 to more than 17,000 in just 18
months, flooding the market with choice and giving buyers more competition and more leverage in
negotiating on price," Mr Druitt said.
The REIWA data shows listings have reached 17,600 properties up for sale, including more than
2,400 blocks of residential land, many of which are likely being offloaded by speculators.
Mr Druitt said the overall number of selling days had also blown out, stretching by six days to 71
days, between a home being listed and a contract for sale being secured.
Mr Druitt said that despite the record number of listings, he was confident the pent up demand
from would-be buyers would soak up much of the excess throughout 2008.
"As the population continues to swell on the back of a strong economy, many people have been
keenly waiting and watching for the right time to buy.
"Now, with interest rates on hold and possibly coming down shortly, and property prices
rationalising to a more afford able level, we are likely to see some renewed buyer activity in the
market.
"However, until we see a return in buyer confidence we are unlikely to see any significant price
growth in the Perth market," Mr Druitt said.
RENTS
Rents have also increased according to REIWA, but Mr Druitt said the news had a silver lining for
tenants.
"Although rents have increased once again, the rise is more modest than in the past and hopefully
represents some stabilisation in the rental sector," he said.
Median rents for houses rose by 1.5 per cent to $335 per week, while units roses 3.3 per cent to
$310 per week.
"The overall median rent across Perth is now $330 per week, while the vacancy rate has dropped
0.6 per cent to a very tight 1 per cent in March.
"However, we are likely to see the vacancy rate ease right back from this point given the huge
number of listings on the market.
"Many investors may find it hard to sell their properties in the short term, and decide instead to
hold them for a few more years and to turn them over to the rental market in the mean time.
"This should certainly help ease the rental crisis by supplying lots of stock and helping to moderate
rent increases," Mr Druitt said.
REGIONAL WA *
In the West Australian regions it's a slighter better picture with strong growth in some areas.
"The Mandurah/Murray region came back into positive territory after three quarters of negative
growth, which saw the median house price grow by around 1.5 per cent in the March quarter.
"In Greater Bunbury and Geraldton prices remained stable, while early indications are that
Kalgoorlie/Boulder's median house price increased by about 10 per cent on the back of continuing
demand," Mr Druitt said.
Rental data for Mandurah/Murray shows an increase of 4 per cent in the quarter to a median price
of $260 per week.
Greater Bunbury is steady at $270 per week, while Geraldton/Greenough jumped 14 per cent to
$285 per week due to a greater number of houses being rented rather than units.
Kalgoorlie/Boulder remains a more expensive regional rental market, rising 6.7 per cent in the
quarter to $320 per week.
For the first time REIWA has conducted rental vacancy surveys with its regional membership and
this has revealed the following vacancy rates in several country areas:
Mandurah/Murray 5.5 per cent
Bunbury 3.3 per cent
Geraldton/Greenough 2.1 per cent
Kalgoorlie/Boulder 0.7 per cent

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