Perth’s housing market experienced a rebound of activity at the end of last year with sales turnover during the December quarter moving back to the long term average for the metropolitan area.
REIWA President David Airey said the strong sales activity through the December quarter had not slowed and that enthusiastic ‘buyer momentum’ had carried into the New Year.
“Sales normally calm down over the Christmas holiday period but that didn’t happen last year. The real-time reporting from our members currently indicates that January will also be a bumper month for turnover,” Mr Airey said.
Earlier analysis by the Real Estate Institute of Western Australia showed the median house price lifting by 4 per cent on the previous quarter, suggesting 2013 would end up with
growth of at least 7 per cent across the year.
However, Mr Airey said real-time sale data from REIWA agents indicate that the quarterly growth was closer to 6 per cent and pushing Perth’s median house price towards $545,000 through 9 per cent annual growth.
Article added by: REIWA Communications
“This has largely been driven by two key factors.
“The number of first home buyers has dropped 12 per cent since the June quarter with a notable fall in sales under $400,000, while at the same time there was an increase in sales over $600,000. Together, this compositional change in sales acted to pull the median price upwards towards the end of the year,” Mr Airey said.
“I think the fall in turnover with sales under $400,000 has largely been a reaction to both low levels of housing stock and also affordability pressure on some first home buyers.
“The number of houses and vacant lots on the market is below average by about 3,000 properties and this is increasing demand on the available stock,” Mr Airey said.
FIRST HOME BUYERS
Mr Airey said strong first home buyer activity had been a significant market driver over the past 18 months, although applications for established homes dropped away by 12 per cent in the December quarter.
Data from the Office of State Revenue show there were approximately 5,330 first home buyers in the December quarter paying a median purchase price across the state of around $433,000.
“However, countering the drop in demand for established homes was a 9 per cent lift in applications for new buildings following the state government’s increase in grants for first homebuyer construction,” Mr Airey said.
Entry-level activity had prompted an increase in trade-up sales as relinquishing owners sold to first time buyers.
The City of Fremantle dominated house price growth for the quarter with the western part of the City of Stirling also doing well.
Mr Airey said that across the whole year price growth was strongest in the City of Belmont, while the cities of Fremantle, Gosnells, the western suburbs and the northern end of Joondalup were close behind with growth exceeding the metropolitan average of 7 per cent.