REIWA reports that the median house price for Perth for the May 2015 quarter remained steady at $547,000 but that rents have fallen again (see full article here).
Now that we’re entering the Winter months we would normally expect to see a slowdown in listing and selling activity. The number of properties currently listed for sale remains steady at around 14,250 (as at 24 June) but we seem to be having an end of financial year flurry in sales with a 10% bump on the usual average recorded last week.
Overall, Perth sales activity has been below average since Easter, despite the May interest rate cut, reflecting the decline in WA consumer sentiment. The Westpac–Melbourne Institute June consumer sentiment survey showed a fall in consumer sentiment in WA back into pessimistic territory with the ‘time to buy a dwelling” index remaining almost unchanged since falling 31 per cent between February and April.
The two words I would use to describe the current market are patchy and fickle.
Anecdotally, we’re still seeing good demand locally by trade-up buyers looking for quality family homes that are both well priced and presented. I recently had 39 groups of buyers through the first weekend for a lovely 4×2 family home in Noranda and a stunningly renovated 3×2 we had for sale in Inglewood also attracted significant interest – both sold for well over their advertised prices. Conversely, it feels like prices have slipped for properties where there is an abundance of similar stock and choice, new or near new 3×2’s on subdivided blocks or apartments and units for example, but again there’s still exceptions to these as well.
What I’m finding interesting is buyers’ growing preference for renovated or upgraded properties, with those that are poorly presented or in need of work being overlooked or penalised by buyers. This may simply reflect the fact that there’s now more properties for sale for buyers to choose from. Whatever is driving it, in the current market presentation is critical to achieving a premium price outcome. But what do you do and how much do you invest in presentation? Asking the opinion of an experienced real estate professional could literally make or save you thousands of dollars by helping you to make the right kind of improvements to your property (which might be as little as a giving it a good clean, taking care of essential maintenance and de-cluttering) or if you have an investment property, waiting until your tenant moves out and staging the property for sale so that it presents in its best light. I continue to maintain that focusing on presentation is the single best investment you’ll ever make in your selling price.
And what lies ahead in terms of the Perth property market? Who knows! I know that many buyers are predicting (or wishing) a softening in prices in the months ahead based on speculation about local unemployment and the economy, but my question is by how much, when, for how long, and indeed, if at all? And I also know that we won’t know the market has turned (up or down) until after it has. So do you buy according to the market or your life? I’ve bought two properties this year because I thought they represented good value (both need renovating), but I’m not fussed about what happens in the short term – my game is a long term one. What’s yours?
