Western suburbs house prices set to rise
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Moody’s Analytics is forecasting continued weakness in Perth's residential property market this year but a return to positive growth in 2019, with Perth’s western suburbs and Mandurah tipped to be the best-performing regions.
Moody’s has developed an econometric model to forecast the direction of Australia’s residential property market down to the statistical area level four, using historical data from CoreLogic’s home value index.
The report flagged a 1.9 per cent decline for Perth overall in 2018 as the local economy continues to recover.
Moody’s said 'Perth inner', which includes the western suburbs and central Perth, will be the only area to record growth in 2018 and is forecasting a 2.4 per cent rise in prices.
The north eastern suburbs, which includes Bayswater to Bassendean, Mundaring and Swan, will notice a 3.4 per cent decline in prices this year, according to the analysis.
Perth is expecting overall growth of 1.2 per cent in 2019, led by Mandurah with a 5.7 per cent spike in house prices.
That comes after a decade of weakness, with home values in Mandurah currently 30 per cent below their 2007 peak.
Perth inner is set for a 2.0 per cent price increase in 2019 while house prices in the south western suburbs, including Fremantle, Cockburn, Kwinana and Rockingham, are tipped to rise 1.9 per cent.
Bunbury house prices are set to fall 4.1 per cent this year and increase 0.4 per cent in 2019.
The analysis said WA had borne the brunt of the collapse in mining investment, but conditions were stabilising.
“After a period of falling values, home values in Perth and Western Australia more broadly are entering a recovery, although likely only later in 2018 at the earliest,” the report said.
“This comes as a result of a rebound in commodity prices, which is helping enable a recovery in income growth and more stable population growth, albeit at a lower rate than in past years.”