So here we are at the end of May and the consistent question from buyers, sellers and home owners alike is “How’s the market?”.
The Perth property market is something we contemplate daily. What’s new to the market, what’s sold and how much for, how long has something been on and what’s it been price adjusted to, what’s happening with rents, what’s happening with migration and unemployment, what’s happening with interest rates and what lending changes are the banks introducing now? All of these things and more feed into consumer confidence and influence price and market activity. Most importantly, and you’ll always hear me say this, the Perth market is not homogenous. What we see is that different parts of the market are still performing very differently, so what’s reported in terms of overall Perth property price movements isn’t always reflective of what may be happening in a particular suburb for a particular type of property or price point. Nothing beats the experience of an active local agent in examining and explaining this.
So where to from here? My reflections in my April review remain broadly unchanged. Locally, the quality trade-up market still seems to be where most of the activity and interest is occurring, albeit not at the same price points as they were a few years ago. (Analysis from CoreLogic indicates Perth property prices overall are 10% down on where they were at the end of 2014 – click here for more). We’re not seeing anything locally, economically, that gives us any reason to see things changing significantly in the short term and prospective sellers need to carefully weigh up the costs of holding onto their properties (ie wear and tear, building depreciation and interest charges) versus the possibility of gains, particularly for a newer home or where there is a lower land to valuation ratio (meaning the % of the overall value the house represents versus the land component). Unless you’re planning to invest in improvements, the property you’re selling today won’t be the property you’re selling in two or three years time.
For up to date sales information and an opinion specific to your property and suburb, please call me on 0405 812 273 – I’d love to help.