Perth’s median house price increased 1.6 per cent to $518,000 during November, according to reiwa.com data.
REIWA President Damian Collins said this was the second month in a row Perth’s median house price had shown improvement.
“Perth’s median house price has been fairly flat throughout 2018, so it’s pleasing to see two consecutive months of median price growth as we head into the New Year.
“reiwa.com analysis shows there was a shift in the composition of sales in November, with a greater proportion of transactions occurring above $1 million than there were in October. This has contributed to the increase we’ve seen in Perth’s median house price this month,” Mr Collins said.
The top selling suburbs in November were Willetton, Baldivis, Canning Vale, Duncraig and Ellenbrook, while reiwa.com data shows Quinns Rock, Willetton, Doubleview, Leeming and Wellard had the biggest improvement in sales volumes (percentage wise).
“While overall sales activity in the Perth Metro region remains subdued, numerous suburbs bucked this trend during November to record notable improvements in sales,” Mr.
Listings for sale were five per cent higher at the end of November than they were at the end of October.
“It’s not unusual to observe increases in listing stock at this time of year. Sellers are returning to the market following the lull of the winter period and wanting to get in quick before the holiday season ramps up. With listing stock rising, buyers have a good supply of choice available to them, making it a very good time to buy,” Mr Collins said.
Perth’s overall median rent price continues to hold at $350 per week, however reiwa.com data shows there was a small $5 increase to the median unit rent price in November.
“While the overall median and median house rent ($360 per week) were stable, pleasingly the median unit rent did increase to $330 per week during November. Additionally, when we compare the November 2018 median unit rent to three months ago (August 2018), reiwa.com data shows the unit rent has increased by $10 per week,” Mr Collins said.
The five suburbs which experienced the biggest increase in leasing activity (percentage wise) during November were Kardinya, Coolbellup, Bedford, Kelmscott and Harrisdale, while Perth, East Perth, Scarborough, South Perth and Baldivis had the most number of leased properties.
Listings for rent were stable in November, remaining below 7,000 – a significant 25 per cent decline compared to the same time last year.
“The rapid decline in listings we’ve observed this year is a key driver behind the rental market’s recovery. It has also had a significant impact on the vacancy rate, which continues to decline and now sits at 3.3 per cent,” Mr Collins said.
In the middle of last year, several top economists were predicting house prices to in fact increase in 2018 – one forecasting as much as nine per cent, but since then house prices have experienced their largest and longest peak to trough decline in recent history spurred on by increased housing affordability constraints, a banking royal commission with a microscope on lending standards, and APRA’s restrictions on new investor loans.
Now that the price falls are well and truly in motion, all five economists recently surveyed by The Australian Financial Review forecast national house values would continue to drop in 2019, with Sydney, the epicentre of the downturn, dragging down the national average.
Stephen Koukoulas, of Market Economics, was most downbeat about the state of the property market, with expectations prices would fall in Sydney between 7.5 per cent and 10 per cent in 2019 after a drop of 7.5 per cent in 2018.
Nationally, he predicted house prices would fall by between five per cent and 7.5 per cent.
“From the 3rd quarter in 2019, I am forecasting some stability in prices as supply and demand forces underpin new activity,” Mr Koukoulas said.
By then he expected cashed-up first-home buyers would be lining up to take advantage of increased levels of affordability.
A key consideration for Geordan Murray, HIA acting principal economist, is that while population growth is slowing, it remains strong and will ensure ongoing demand for housing throughout the cycle.
“The labour market has been improving and is projected to continue to do so. This should contribute to further modest improvements in wage growth,” Mr Murray said.
“There are risks around borrowing costs.”
A key issue mentioned by the economists was that at some point in 2019 is whether the RBA may be forced to consider another interest rate cut if the slump in home prices starts to impact consumer spending and the outlook for inflation.
While each economist offered a variation on how much prices would fall in 2019, each attributed the tightening of credit, rising mortgage rates, and a surge in new supply to the further softening of the market.
To see each economist’s predictions, read the full article on the Australian Financial Review. Please note you will need to be an AFR subscriber to read the full article.
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As the end of your tenancy agreement approaches, it can be a very tedious process dealing with your bond refund.
Ideally, most tenants will receive their bond money back at the end of the tenancy, once the real estate agent inspects the property against the Property Condition Report (PCR), essentially ensuring the premises is in the same condition as it was at the commencement of the lease, taking into account fair wear and tear.
However, if the state of the property does not comply with the PCR report, then the property manager or landlord has the right to claim money from the bond to cover these expenses, which could be anything from broken door handles to garden maintenance.
We want all tenants to be confident when it comes to getting their bond back, so to take the guesswork out of your end of lease inspection, here is some advice when it comes to getting your full bond back.
Taking the time to fill out the initial PCR when first moving in can save you a lot of money and hassle when it comes to your last inspection. When moving into a new place, the last thing many tenants want to do is diligently inspect every nook and cranny of the house, but it’s these minor issues that become the very cause of disagreements between the agent and the tenant during the final inspection.
Use the initial PCR as a reference, so you and the managing agent have something to compare when it comes to the final inspection. It can be useful to take photos and be as specific as possible.
Communication is key to being a good tenant. If there is something on the property that needs attention, make sure to tell the agent sooner rather than later. Building a good relationship with the property manager or landlord and having open honest communication will ease pressure on both parties when it comes to you vacating the property.
Stay educated with the law surrounding your tenancy. This will lower your chances of being short-sighted with any unexpected issues down the track.
You can visit The Department of Mines, Industry Regulation and Safety website for more information on the laws affecting tenants.
It might seem obvious, but you’d be surprised at what the result of leaving the drain untouched or not vacuuming under the couch during the length of your tenancy could be. By regularly cleaning your house, you lower the risks of growing mould, stains or lingering smells. If you have carpets, maintaining them is also important as replacing carpet can cost a fortune if stained or damaged.
Again, knowing what to expect will save you from any unwanted surprises when it comes to getting your bond back. Understanding the process will make things easier for both you, the real estate agent and the landlord.
In the event of an unresolved dispute, the courts will ultimately decide the allocation of bond monies.
If you make every effort to return the property to the owner in the best possible manner at the end of the tenancy, you are in a good position to have your bond refunded in full.
REIWA is disappointed the members of WA Parliament have ignored the concerns of the property industry by voting to pass the Foreign Owner Duty Surcharge tax.
REIWA President Damian Collins said the new tax would likely have significant consequences for the WA property market, which was just starting to show signs of a recovery.
“The WA property market has endured a challenging few years. We are just starting to see the green shoots of a recovery on the horizon. A new tax will only serve to further dampen our already weak market and deter much needed foreign investment from the state.
“WA has the lowest level of foreign investment of any state, second only to the Northern Territory. This ill-timed tax will place an additional barrier for people wanting to move to WA and set up a home.
“Although foreign buyers only make up a small proportion of the WA market, it’s a proportion we can’t afford to lose. Especially at a time when the market is showing signs of stabilising,” Mr Collins said.
Foreign buyers of residential properties in Western Australia will pay a seven per cent surcharge from 1 January 2019.
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Before you can set a realistic budget for buying your dream home, you’ll first need to find out how much you can borrow.
Your borrowing power depends on your income, assets and current living expenses, as well as the size of your deposit and credit history.
Here are three things to consider in order to potentially improve your borrowing power.
Living expenses have a way of eating into your cash flow, so keep a record of what you’re spending. You might be surprised to see where your money is going – and how much you can save.
Cutting back on large and unnecessary expenses might help boost your borrowing capacity, but you don’t have to be too strict with your budget – make sure there is a little wiggle room for things like holidays or brunches with friends.
As a general rule, the more money you can put down upfront the better. Sometimes this isn’t an option, therefore a Low Deposit Loan might suit you – often referred to as a No deposit home loan- although this shouldn’t be your first preference.
Not only does a bigger deposit mean you won’t have to borrow as much, it may also help you avoid paying LMI ( Lenders Mortgage Insurance) protects the lender if you default on your repayments.
You are typically required to pay LMI if you need to borrow over 80% of the purchase price, but even a 20% deposit may not cover stamp duty and other fees and charges associated with buying a property.
If you need to add these costs onto your home loan, you may end up over the 80% threshold and liable for LMI, so aim to save at least 25% of the purchase price to create a bit of a buffer.
Potential home loans lenders will access your credit history to see if you can afford the loan you are applying for, and whether or not you are likely to repay it.
Having a bad credit history may reduce your borrowing power and can potentially increase your interest rate, so make sure you review your credit history every 12 months to correct any mistakes.
It’s also a good idea to try to avoid extending the limit on a credit card or taking out a loan for a new car in the months before applying for a home loan, as the number of times lenders request your report can impact your credit score.
Understanding your financial position is the first step to boosting your borrowing power. Budgeting carefully, setting a savings goal and building a strong credit history can all help take the stress out of applying for a home loan.
The Perth rental market continues to show promising signs of improvement, with the vacancy rate falling to 4.5 per cent in August – the lowest it’s been since April 2015.
REIWA President Hayden Groves said the Perth rental market had shown encouraging signs across all key indicators.
“What we are seeing is a steady yet healthy improvement in tenant activity,” Mr Groves said.
“Steady rents, easing supply as listings for rent continue to fall and stronger demand with more leasing activity all point to the rental market leading Perth’s property market recovery.”
Leasing activity was up 17 per cent in August, with 4,805 dwellings leased during the month.
Mr Groves said reiwa.com data had revealed the suburbs of Leederville, Glendalough and Secret Harbour experienced the most significant growth in leasing activity during August.
“Leederville had more than double the amount of properties leased from July to August, with the volumes increasing by an impressive 183 per cent,” Mr Groves said.
“Typically, as we move into these warmer spring months, the property market should see an overall uplift in activity, and historically the sales market follows the rental market during a recovery.”
Perth’s median rent continues to hold for the 17th month straight at $350 per week, with no changes recorded since April 2017.
Mr Groves said it was pleasing to see stability return to the rental market, giving both tenants and property investors’ greater certainty and confidence in the leasing sector.
North Fremantle, Bicton and Nedlands are among the 12 Perth suburbs to have experienced house price growth this year after suffering declines last year.
REIWA President Hayden Groves said 12 suburbs across the metro area had defied the declining trends experienced in the 12 months to June 2017, to record strong house price growth in the 12 months to June 2018.
“It’s really pleasing house prices in these suburbs have recovered so well in just 12 months. All of the suburbs on the list have higher median house price values now than they did in 2016 just prior to the decline, which is positive news for sellers in these areas.
“North Fremantle had the strongest rebound in price, with its median increasing 28.1 per cent to $1.23 million in 2018, after declining 0.8 per cent to $960,000 in 2017.
“Bicton came in second, with a 17.6 per cent median house price increase this year after declining 6.5 per cent last year, while Nedlands, Kallaroo and West Leederville saw house prices lift by 15.5 per cent, 14.6 per cent and 13.4 per cent respectively in the 12 months to June 2018,” Mr Groves said.
Helena Valley, City Beach, Claremont, Mosman Park, Winthrop, White Gum Valley and Leeming rounded out the 12.
reiwa.com analysis shows all suburbs on the list had a median house price above the Perth Metro median of $515,000 and seven of those suburbs had median house prices above $1 million.
“Perth’s aspirational suburbs are really leading the way in the property market’s recovery. Last quarter there were more houses sales recorded in the $800,000 and above price range, which is a trend that also occurred during the December 2017 quarter. In addition, recent reiwa.com data also shows 11 per cent of houses sales in Perth now sell above $1 million, which is the highest proportion of million dollar sales Perth has seen,” Mr Groves said.
“Another interesting observation is that nine of the 12 suburbs had faster average selling days than the Perth Metro region average of 66 days, with Nedlands (28 days), Claremont (40 days) and West Leederville (47 days) the standouts.
“There is genuine competition amongst buyers in the luxury end of the Perth market, forcing buyers to act fast in these areas and pay a premium to secure the property. Home owners in these suburbs who are thinking of selling would be wise to take advantage of these favourable market conditions.”
|Suburb||Median price (June 2017)||Annual change vs June 2016||Median price (June 2018)||Annual change vs June 2017|
|1. North Fremantle||$960,000||↓ 0.8%||$1.23 million||↑ 28.1%|
|2. Bicton||$892,500||↓ 6.5%||$1.05 million||↑ 17.6%|
|3. Nedlands||$1.45 million||↓ 3.7%||$1.675 million||↑ 15.5%|
|4. Kallaroo||$700,000||↓ 9.4%||$802,500||↑ 14.6%|
|5. West Leederville||$1.1 million||↓ 1.6%||$1.247 million||↑ 13.4%|
|6. Helena Valley||$530,000||↓ 9.6%||$600,000||↑ 13.2%|
|7. City Beach||$1.627 million||↓ 4.9%||$1.835 million||↑ 12.8%|
|8. Claremont||$1.3 million||↓ 3.7%||$1.455 million||↑ 11.9%|
|9. Mosman Park||$1.285 million||↓ 1.2%||$1.38 million||↑ 7.4%|
|10. Winthrop||$840,000||↓ 1.2%||$899,000||↑ 7.0%|
|11. White Gum Valley||$682,500||↓ 3.2%||$730,000||↑ 7.0%|
|12. Leeming||$660,000||↓ 5.7%||$705,000||↑ 6.8%|
|Perth Metro||$520,000||↓ 2.8%||$515,000||↓ 1.0%|
Median house price data is for the 12 months to June 2018 versus the 12 months to June 2017.
Filtered for suburbs with more than 28 sales.
Alycee Barrett is the epitome of a “real estate agent”. She goes above and beyond to make you comfortable and confident and at the end of the day delivers in spades. She has sold three houses for us but she excelled herself on this last occasion. We had two weeks between a bad tenant leaving…Read More→