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Affordability coupled with strong economic growth continues for WA

Posted 13 April 2022

In the two years since the Pandemic began, West Australia has experienced the strongest economic performance in the nation throughout COVID-19.

General Manager of Summit New Homes Adam Schaal, said we can expect to see another surge of consistent buyer activity with demand from both domestic and international travellers returning to WA.

“With WA’s economy holding strong, Perth has become the place to be, with potential buyers and investors actively trying to get into the market,” Mr Schaal said.

“Perth’s showing a robust recovery in property prices, with demand now outstripping supply in many corridors across the new and established markets which will continue to put upward pressure on property prices.

“Following the government grant stimulus, we are still seeing strong demand in new home builds, with first home buyers very active in the market due to ongoing pressure in the rental market.

“According to SQM Research, in the three years prior to February, Perth’s vacancy rate has fallen from five percent to 0.6 percent while the asking rent for houses has increased by 13.7 percent.

“The Bankwest Curtin Economic Centre has also found that home loans for WA owner-occupiers increased by 150 percent between 2020 – 2021 and home loans for investors have risen by more than 55 percent over the last year alone.

“Yet despite the strong market conditions and price growth, Perth still has the most affordable median house price of any capital city in the country,” Mr Schaal said.

Last month, the Real Estate Institute of Australia (REIA) released its national Real Estate Market Facts for the December 2021 quarter, which found Perth had a median house sale price of $525,000, followed by Darwin at $592,500 – the only two cities below $600,000.

“With capital growth and increased construction costs, people may have trepidation of entering the market place,” Mr Schaal said.

“Compared to the rest of the country, we are still in a great value proposition here in WA.

"Considering our GDP, our low unemployment and high median wages, we are a great value state for people to live. And the best part, we also have the most amount of sunshine in Australia with 147 sunny days a year.”

In a bid to ease trade shortages and keep housing construction moving forward, the WA Government recently launched the Build a Life in WA campaign nationally and more recently in New Zealand.

“The government investing in this kind of labour recruitment should be a clear gauge of how buoyant the property market is right now and the real pressures our supply chain is facing,” Mr Schaal said.

Mr Schaal continued by saying he is optimistic that continued strong demand coupled with WA’s robust economy will equate to a strong 2022 for the WA property market.

“It’s been a busy two years responding to the current market conditions, but in that time we’ve ensured our business remains agile, we’ve grown our team significantly and we’ve worked hard to get our product mix right so we are well positioned for the upwards growth the market is expected to see for the remainder of the year.”

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