Median house prices in WA have increased for the first time since March 2010, new data has revealed.
According to data gathered in the December quarter from the Real Estate Institute of Western Australia there has been an increase of around 0.5 per cent, this positive movement represents the first lift in median price since the market peaked in March 2010 and puts the current median at around $465,000; up by $5,000 on the revised September quarter figure.
The data suggests that the fall in median price since March 2010 may have ended.
REIWA president David Airey said the shift in median price was largely insignificant because it was triggered by an increase in trade-up buyers countering the influence of first home buyers.
“First home buyers have been skewing the median downwards by generating large sales volumes of more affordable homes, but now this has been balanced with more up-grade buyers in the market who tend to purchase the more expensive properties,” Mr Airey said.
“REIWA data show that while first home buyers continue to be increasingly active in the market, we saw an increase in trade-up buyers during the December quarter and an increase in house sales of around six to seven per cent which may have put a floor under prices.
“It’s a similar situation in the multi-residential sector with units, apartments, villas and townhouses also experiencing an increase in turnover and a one per cent increase in median price,” Mr Airey said.
The number of houses for sale has fallen to its lowest level since March 2010, while land remains over represented with 2,800 lots on the market.
“The housing market seems to be stabilising with an increasing number of sellers adopting more realistic asking prices, with both the number of sellers discounting and the average discount both coming down in the quarter,” Mr Airey said.
REIWA data show that around 68 per cent of sellers are discounting by around seven per cent, while the overall market discount, once you factor in those sales which achieved or exceeded the asking price, dropped to 4.2 per cent in the quarter.
Mr Airey said the rental market is the emerging pressure point in the housing system, with the vacancy rate tightening further and rents for houses increasing.
“Our preliminary data show the vacancy rate dropping to 2.3 per cent in the quarter and well down on the 3.4 per cent from the same period last year. While the median rent for units and apartments remains steady at $380 per week, it has increased by $20 for houses to $420 per week,” Mr Airey said.
The overall median rent for Perth has reached $400 per week, representing an increase of 8.1 per cent over the last year.
“It’s evident there is greater confidence retuning to the property market reflected in the increase in sales activity in the December quarter and the fall in listings we saw across 2011.
“This bodes well for a positive start to 2012, but we still maintain some level of cautiousness given the global economic situation despite WA having a more robust economy,” Mr Airey said.