It continues to look positive for the Perth property market.

House prices rise again

According to REIWA, Perth’s median house price rose a further 0.9% in July to hit a record high of $560,000.

CoreLogic’s home value index showed a slightly higher increase of 1% for Perth in July, with house price growth of 3.2% for the quarter.

While the median house price rose, the Perth median unit price reportedly fell by 0.4% in July to be 2.9% lower than a year ago.

At Red Fox, we were surprised by the fall in unit values, as we’re seeing higher buyer numbers at units for sale and are achieving higher prices than previous sales in groups. It’s a great reminder that the Perth market isn’t homogenous, and it’s important to pay attention to your local market as well as the overall.

Low stock levels a factor

One of the factors contributing to the rise in house prices is the lack of stock.

Properties listed for sale fell 3.1% during July to 5181. This is 39.4% lower than a year ago. The average days on market in July were 10, the same as for June.

If you haven’t noticed, homes are selling fast.

As we move into warmer weather, we expect the number of properties for sale to increase.

Sellers planning to launch later in the year will likely be selling with more competition, and there should be a little more stock for buyers to choose from.

But don’t expect the pendulum to swing towards buyers any time soon.

Market equilibrium is considered to be around 11 to 12 thousand listings, and we’re less than half that now.

In the inner north, there is an acute shortage of family homes. We believe any additional supply will be quickly snapped up due to the pent-up level of buyer demand.

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Rents remain steady; supply falls

At the end of July, there were 1,876 properties available for rent on reiwa.com.au, which is 11.4% down on June and a reduction of 16.4% since July last year.

We continue to speak to landlords looking to get out of investment stock due to interest rate rises and recent price recoveries. In many cases, despite increased rental returns, it simply isn’t worth their while to hang onto them. So we don’t expect the rental shortage to ease any time soon.

The median rent for dwellings remained at $550 for July, the same as in June, and the median time to lease a property also remained unchanged at 16 days.

So where is it headed?

What we think, and are hoping for, is that the market will continue to experience moderate price increases over the coming months.

Perth’s median prices are still well below that of other Australian capital cities (only Darwin is cheaper), and with our strong economy, low unemployment rate and positive migration rate, we don’t see demand dropping any time soon.

If you put off buying last year because the market would fall by 20% as some pundits predicted, you should have learned by now not to believe the headlines.

If you are shopping for a house in the inner north, there’s a good chance prices have gotten away from you while your affordability has decreased thanks to interest rate rises.

It’s not timing the market that’s important; it’s time in the market. Property is a long-term investment.

And if you’re considering selling? We think now is a great time to go, while stock levels are so low.

You don’t get better evidence of buyer demand than an average of 10 days on the market.

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If you’re looking for advice specific to your property and personal circumstances, we’re here to help. Call or SMS Nat now on 0405 812 273 to book a confidential catch-up and chat.