Perth, the former economic powerhouse is showing signs of flagging
The Perth market was once one of the country’s strongest but has begun to stall in recent times.
RP Data warns demand may weaken as interstate migration begins to slow. Though Western Australia was traditionally the most common destination for interstate migrants, its popularity is dropping off. While the state continues to have the third highest net migration, migrant numbers are down by 19.8 per cent on last year.
This slowed migration, coupled with precarious economic conditions, may cause price growth to stall, BIS Shrapnel has warned. BIS predicts the market will fail to keep pace with inflation over the coming three years, with prices growing by only three per cent to mid-2017.
Sales volumes in the city are already starting to plummet, according to RP Data. The number of house sales has dropped by 5.9 per cent over the year while unit sales are down 17.6 per cent.
Nonetheless, there are positive signs for the Perth market at present. Two of the top 10 fastest-selling suburbs in the nation are found in the city. Properties in both Coolbellup and Lynwood sell, on average, within 13 days of being listed.
RP Data also found Perth is the second-best market for vendors, with only five per cent of re-sales resulting in a loss.
However, the outlook is less positive for the regions, where 17.5 per cent of re-sales were for less than the original purchase price. The Wheatbelt region was hit hardest – up to 19.9 per cent of sales here netted a loss.
Country Western Australia’s stand-out town is West Busselton, according to Residex. The coastal town, around three hours south of Perth, recorded capital growth of 23.25 per cent over the past year.
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