Monday, February 22, 2021

Perth house prices predicted to increase 20%

Westpac economists have boldly predicted that Perth prices are about to go up 12% this year and 8% next year. With buyers saving more than they ever have during the pandemic and getting wiser about the use of borrowed money, many are in a better position to buy than ever before. Interest rates are low and the rental market is forcing many to make the leap into home ownership. Investors are also coming to the conclusion that money in the bank is going backwards. Some are moving into the sharemarket while others are sticking to real estate. Are you a buyer entering the market for the first time? 

Tuesday, June 23, 2020

Land Sales Starting to Show in Perth

REIWA has just reported that last week saw a massive increase in land sales. Anecdotally, those that had land to sell reported that their phone was ringing off the hook with developers and potential buyers. Last week there was a 7.7% increase in house sales, 1.8% increase in unit sales and... 58.5% increase in vacant land sales! Availability of rentals are down 44% from last year and 17% lower than a month ago.

Have a look at this graph and come back in a few weeks to see what happened to property sales following the Federal and State Government rebates announced recently.

Source: REIWA and Landgate

Thursday, June 18, 2020

What would the RBA do if they were a first home buyer?

An interesting article came out this morning that said RBA economists were so pessimistic about the housing market in April that they suggested to the federal government to "pause" transactions on existing homes! The expectation is that house prices will drop about 7% in the coming year with a worst case scenario suggesting a drop of 15% in value also a possibility. The article from the ABC can be found here.

So coming back to the topic of buying a home, it seems that the incentives all favour building vs buying an existing home. Doesn't this hurt existing home values even more? If you were to choose between buying and building right now, what situation would one be where they decide to overlook the $45,000 incentive to build? And if you are selling in an area where there are still house and land packages available for sale, why would a buyer buy your house rather than get a $45,000 discount on building?

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