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Perth house prices weaken again

The value of houses and units in Perth fell again in the March quarter, new data from Australian Property Monitors has found, but the group has predicted a market revival by year's end.

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Perth
Prices are dropping due to houses being over valued and out of reach of not just first time home buyers. With interest rates on the rise, utilities and staple grocery items on the up, the 2nd and 3rd link buyers will soon be out of the market too, as wage increases have not kept pace with inflation. The resource boom will not have an impact on the pricing of houses due to the minimal number of people working in the sector, an average of 14 - 15 percent. With inflated land prices this sector will continue to decline, which in turn will increase the downward pressure on existing established stock, with the mentality of why build?

WA
Something no-one appears to be mentioning is the issue of 'over-priced' tradies and the correlation their high charges have on the cost to build and buy homes. Most other wages have remained static- unless you work in the mining sector (which means you are still likely to a tradie). If we 'import' a significant number of tradespeople and mining sector workers from abroad and / or skill-up a massive number of young people (including women) in the trades then 'tradie' wages should come back into line with median income levels.

Perth
There has been much discussion around inflated house prices & links only to wage increases / inflation. To review this based upon a single measure is wrong. There are many other forces that conveniently get left out of these arguments. Things such as dwelling shortages, structural declines in interest rates over time, taxation changes etc all play a part. Looking holistically at these factors largely supports the increase in house prices over the years. Confidence is the real issue.....

Perth
There may (or may not) be 15% working directly in mining, but Ivan has obviously not heard of the knock on, or domino effect. Where are the mining workers going to spend their dollars? In the community! Also, there are a large number of permanent migrants arriving in WA who will be requiring either housing to purchase or rentals. If its rentals, then someone will still need to own the property they are renting (investors) Every dark cloud has a silver lining. Yes, the market is slow, but that means houses are relatively cheap at the moment. Now is the time to buy up, because I don;t believe it will go much lower.

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