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December 12, 2014 | Media Statement
As sales listings increase and buyers return to Perth’s property market, optimistic consumer sentiment should see increasing opportunities for buyers who know where to look, according to Perth buyer’s agency, Property Wizards.
Buyer’s agent Liz Sterzel said the Perth market has been very much in a “wait and see” mode in recent months.
“Budget negativity and concerns about both global and local affairs have been holding people back from buying and selling,” she said.
“The cost of living and the political and economic environment are on the minds of Perth buyers .
“First homebuyers have also held back since the WA State Government’s changes to the First Home Owner Grant came into effect last year but are still in the market for new homes.
“More recently, however, we have seen a pickup in enquiries as buyers begin to return to the market and sale listings have also begun to increase.
CONSUMER SENTIMENT AN INDICATOR OF MARKET PERFORMANCE
Ms. Sterzel said property prices in the months ahead will be influenced by people’s sentiment and how they feel about their future and their financial position.
“Concerns around the continued effect of the mining downturn on jobs has certainly slowed the Perth market,” she said.
“Overall though, employment in the state actually increased in October 2014, according to the Australian Bureau of Statistics.
“Additionally, WA benefited from a small improvement in consumer confidence in September 2014 according to the Chamber of Commerce and Industry (CCI) Consumer Confidence Index.
“More people appear to be in a better financial position and overall debt levels have been reduced, which is great news as it puts people in a better position to make that property purchase they have been contemplating,” she said.
“Adding to the positive news, the Commsec State of States Report released in October 2014 shows WA still has the second best performing economy in the nation with its new economic drivers being housing purchases, housing finance and construction.”
OPPORTUNITIES STILL PRESENT IN QUIETER MARKET
Ms. Sterzel said most of the enquiries she has received are from investors looking for add value opportunities, with a focus on subdividing now or holding a property in a proposed rezoning area for later.
“Good add value properties are a very popular investment strategy, but as prices have risen since last year, buyers are moving further afield in their search.”
“Areas with proposed rezoning especially are growing in popularity,” she said
“As for buy-and-hold investors, they are targeting properties further from the city but with strong public transport links and local amenities which will appeal to tenants.”
“And those first homebuyers who had dropped out of the market are now behind the rise in popularity of the new and off-the-plan apartments as they embrace the increase from $7,000 to $10,000 in the First Home Owner Grant for first homebuyers who build or purchase a new home.”
Ms. Sterzel also said the rental market has softened recently due to a period where there were more homes available to rent than renters looking, leading to a slight decline in rents.
“However, we’re now seeing rents stabilise, with REIWA’s latest update for September showing the median rental at $450 per week, unchanged from last quarter.
“REIWA has also reported a drop in rental listings and vacancy rates, so we would expect the rental market to stabilise in the coming months,” she said.
Ms. Sterzel said that where the market goes from here is very much dependent on sentiment, with market indicators now appearing to have stabilized between September and November 2014.
“Overall, we are cautiously optimistic about WA’s performance for the next 12 months,” she said.
“The increasing number of buyers who have enquired with us in recent weeks are certainly not approaching us with uncertainty or doom and gloom.”