Curious about Perth’s house prices forecast? So we are.
Perth’s impressive property affordability and isolation from the pandemic has made it more appealing than ever to make the switch from east coast to west coast.
Consequently, all aspects of real estate in Perth, such as the cost of conveyancing in Perth and the cost of kitchen renovations in Perth, are being heavily researched.
Although the average home prices in Perth have made it one of the most affordable places to invest in, you also need to consider the rate of growth before you make commitments.
The Perth property market is like any other market and it is predominantly impacted by supply and demand pressures. Let’s dig into the property market for some of the best places to live in Perth and all the factors that impact it by taking a look at the Perth house prices forecast.
Recommended Reading: What Will Predicted House Prices in 2030 Perth Look Like?
History of Perth’s Housing Market
Over the last thirty-five years, the time between property cycle peaks in Perth has varied between 3.5 years and 6.5 years, and this has largely been a consequence of property cycles taking on different forms. President of the Real Estate Institute of Western Australia (REIWA), Damian Collins, said the overall Perth market had seen house prices grow 209% during the last two decades.
“The median house sale price in Perth has grown from $170,000 to $525,000 since 2001, which is modest growth in comparison to other major cities like Sydney and Melbourne that have seen much steeper price increases,” Collins noted.
REIWA data shows Willetton, a popular suburb in Perth, recorded the biggest twenty-year increase, with its median house sale price jumping from $180,000 in 2001 to $820,000 in 2021–an increase of 356%.
What’s in Store for the Future?
The latest Perth housing market insights reveal that the city could be primed for a mini property boom once its borders, which were closed for almost two years by the pandemic, finally open.
As most Australian capital cities recover from COVID-19 lockdowns and restrictions, Perth’s housing market remains isolated, cut off by interstate border restrictions. Despite the inflation in 2021, Western Australia is still the most affordable state in the nation, with Perth’s housing prices remaining 3.4% below their 2014 peak. It is estimated that house prices in Western Australia will rise by 10% in 2022–this is a further growth from last year’s 14%, which suggests a significant increase this year. January 2022 recorded the highest increase on the Perth home value index of 0.6% since May last year.
According to Collins, there will likely be increased sales volume in 2022, which means that pressure will continue to raise the home prices in Perth throughout 2022. Additionally, Perth’s median house prices are also expected to increase between 10% to 15% in 2022. Collins also stated that more investors are coming into the housing sector in 2022; for this reason, more rentals will be available in the market in 2022.
More over, there are several safe places to live in Perth which is a factor that will continue to draw people in.
Policy Updates and Trends Affecting Perth’s Housing Market
Spending and Property Prices on the Rise
Consumers and homebuyers are defying Omicron and rising interest rates, with credit and debit card spending rebounding to pre-outbreak levels. Consequently, the housing market is expected to rise this year.
High Inflation Rate
Living costs are rising far quicker than economists and politicians are appreciating in Western Australia. Perth households endured their biggest price increase in twenty years in 2021 after an unexpectedly sharp spike in consumer costs in the December quarter sent national headline inflation to 3.5%, reinforcing prospects of a rise in official interest rates this year.
Western Australia’s Hard Borders Open
Western Australia’s border closures have been stricter than elsewhere around the country, and this has potentially curbed activity in the real estate market. Because of this, the housing market in Perth would most certainly benefit from people relocating to the state again once the borders open—including from those looking for more affordable property.
Final Thoughts
As much of Australia prepares for property prices to retreat in the face of soaring inflation and looming interest rate hikes, one capital city is quietly bucking the trend. The Perth property market has seen strong market conditions since the end of 2020 with no signs of its momentum slowing down.
With leading market indicators continuing to favour the Western capital, Perth’s property market looks well poised for strong gains over the coming years. The state’s strengthening economy, low stock levels, and rebounding buyer confidence all signal a positive change in the local market. Combined with its relative affordability, these conditions are providing unique opportunities to both local and interstate buyers.
