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With investor attention turning west, here’s what leading industry experts are forecasting for Perth’s property market in 2021 and beyond.
As we work through the first few weeks of 2021, property investors across Australia are focusing on what opportunities the new year will bring, and it seems many are turning their attention west.
’s property market started to gain strong momentum in the latter half of 2020 and these positive indicators led to a growing number of industry experts beginning to take notice of the capital city market, with many predicting positive things for the Western Australian capital.
So, what are some of their key projections?
Louis Christopher, SQM Research
SQM Research’s Housing Boom and Bust Report 2021 forecasts a rise in dwelling prices in 2021 due to government stimulus measures, sustained interest rate cuts and the relaxation of responsible lending laws. Nationally, prices are predicted to rise 5-9%, with the Perth market outperforming the nation with forecast growth of 8-12%.
Louis Christopher, SQM Research Managing Director, said the uptick and investment within the mining sector will provide the catalyst for this growth.
“There now exists a significant shortage of Perth rental properties, which translated into a greater than 9 per cent rise in market rents over 2020. This shortage is very likely to translate into even faster rent increases and stronger buyer activity in 2021.”
Bill Evans, Westpac Chief Economist
Despite originally predicting a downturn across all property markets in Australia, Westpac Chief Economist, Bill Evans,has revised his outlook after capital city markets proved more resilient throughout the COVID-19 pandemic. Mr Evans has since softened his initial downward predictions and now expects a spike in property prices from June 2021. Perth is expected to be at the forefront of this increase alongside Brisbane with a forecast gain of 18%.
“This recovery will be supported by sustained low rates, which are likely to be even lower than current levels; ongoing support from regulators; substantially improved affordability; sustained fiscal support from both federal and state governments; and a strengthening economic recovery,” Mr Evans said.
Terry Ryder, Property Researcher
Founder of Hotspotting and renowned property commentator, Terry Ryder,says Perth’s market has been buoyed by relative freedom from COVID-19 restrictions, increasing first-home buyer activity, and near record low vacancy rates, all of which are placing upwards pressure on rental prices.
“The Perth market has shown greater resistance to the pandemic than most Australian markets in terms of sales activity.”
“Perth has become the most affordable of the Australian capital cities so it’s a great time to be buying there as a first-home buyer and as an investor”, said Mr Ryder.
Jason Murphy, Economist
Economist Jason Murphy is another leading figure who believes the Perth property market is set to make a positive turn thanks to a mix of factors ranging from the state’s response to the COVID-19 pandemic, an increase in mining activity and the overall liveability of the city.
“As the world recovers from the coronavirus, iron ore and energy exports are likely to pick up again, which spreads wealth throughout the state of Western Australia”, Mr Murphy said.
“The mining boom is not what it was admittedly, but iron ore prices are still above US $100 a tonne, which is historically very high”.
Mr Murphy also touched on the affordability of the Perth market, which he said offers prospective buyers much greater value for their money compared with the Sydney and Melbourne markets. Despite prices already beginning to rise, opportunity still exists for buyers armed with the right knowledge and research.
“The downside risk of a Perth house purchase has to be quite low, and that has to be attractive in our current era where nobody is sure what will happen next”, Mr Murphy said.
Damian Collins, REIWA President and Momentum Wealth Managing Director
Momentum Wealth’s Managing Director and REIWA President, Damian Collins, says Perth remains a favourable location for investors and expects median house prices to rise by up to 10% in 2021.
"I would advise those who are thinking of about purchasing their first home, trading up or investing, to act soon before prices inevitably rise," he said.
REIWA data shows that 45% of Perth suburbs recorded median prices rises in December, with other suburbs set to follow in early 2021.
"I expect we're going to see an influx of people come to WA during that January period, which will be challenging because there isn't a lot of properties around for sale or rent.”
"That is why we're going to continue to see upward price pressure on both housing prices and rent as well," Mr Collins said.
Momentum Wealth is a multi-award-winning property investment consultancy based in Western Australia.
To speak to our team in more detail about where we are seeing opportunities across the Perth market, or for more insights into these market indicators, please feel free to get in touch or request a consultation with our property experts.