Perth Market to Kick On

You know there’s talk about inflation and rising interest rates when people start talking ‘basis points’. Australia’s leading property data analysts, Core Logic have picked up the trend revealing property values across the nation rose by an additional 10 basis points in January. In other words, property values rose 1.1 percent for the month after posting a 1.0 percent rise in December 2021.

When considered quarterly, Aussie house price rises are being to slow which is hardly surprising considering the frenetic pace of growth in Sydney, Hobart and Brisbane in particular over the past year. To date, Hobart’s median home value is up 27.6 percent now at $707,087. Sydney’s median price is now a whopping $1,106,279 and Brisbane’s price rises has shot to the lead, growing 29.2 percent in twelve months to register a $706,594 median value

Melbourne is making a comeback of sorts after being locked down for much of 2021, edging up 0.2 percent for the month after posting a modest decline in December. Adelaide, normally a moderate market, improved 2.2 percent in January delivering an annual result of 24.8 percent growth with a median dwelling price of $584,629.

In the Territories, Darwin is up 12.6 percent annually and Canberra is up 25.5 percent, numbers the Prime Minister would love to have if we were measuring popularity.

Despite much local media attention about rising house prices in Perth, our locked up, isolated capital is very much at the back of the field when it comes to dwelling price growth. For the past twelve months, local dwelling prices have risen 11.2 percent, the lowest in the nation behind Melbourne’s 14.9 percent. Our median dwelling price is only higher than Darwin’s at $531,243. Brisbane, normally our most comparable market, has left us for dead with a median value $175,351 higher than ours. The two cities are comparable because our state economies are largely ‘resources dependant’, our lifestyle opportunities are comparable, and we’re defined as ‘not being Melbourne or Sydney’.

Currently, Perth is behind the national median price average by $120,424. Whilst our isolation and hard borders are part of the reason we are lagging behind the rest of the nation, at least we are enviably more affordable here compared to east coast cities. With the national average of 34 percent of wages going to services our mortgages, Perth’s 24 percent measure makes it significantly easier to buy a home here

That is why most property commentators concur that once the borders open, Perth’s property market should fire up. Investors are yet to return in large numbers and with constrained housing supply and demand set to increase, Perth may lead capital city growth for 2022. Certainly, we have some catching up to do.