As 2009 draws to a close, many are wondering what the future holds for the Perth market. As always, there are various opinions amongst the experts. Here are some quotes from various real estate experts on 2010, taken from WA Business News.
"All of us seem to have forgotten the anguish of the first four or five months of the year and we're trying to understand just how on earth the year finished so strongly," - Ray White Real Estate chairman Brian White
"If the whole economy catches fire with a strong growth in wages, then that will really be supportive of a continued strong growth in house prices." - Commonwealth Bank economist James McIntyre
"With prices, we'll probably continue to get a little bit more growth over the next six to 12 months but probably not at the rate that we've seen over the last six months which has been driven a lot by the first home-owner base." - Housing Industry Association chief economist Harley Dale
"I'd expect you'd see steady low-to-mid single digit growth next year" - BIS Shrapnel senior project manager Mr Zigomanis.
Tuesday, December 22, 2009
Friday, December 18, 2009
Who is the author of Home In Perth?
In case you were wondering, I am a Generation Y Perth local who has been looking for a house (passively) for the last three years. I started this blog to encourage other house hunters to share what they've learnt and what they know with other people like myself. It has also become a reference point for some searching for specific information. Hope that you can participate in this blog with your comments and if you want to contact me about anything, my email is myhomeinperth@gmail.com
REIWA announces $475k median house reached
Press release from REIWA:
Perth housing back at peak prices
16 December 2009
Perth's median house price is heading back to the peak level it achieved in December, 2007 according to preliminary research by the Real Estate Institute of Western Australia.
REIWA President, Alan Bourke, said the Institute' figures were showing that strong sales turnover among more expensive homes was pulling the metropolitan median price back up to $475,000.
"It's really quite amazing what can happen in a year and to see how effective the Commonwealth's stimulus strategies have been. This time last year the median sale price had fallen to $420k," Mr Bourke said.
Latest data from the Office of State Revenue show that the market is weaning itself off the First Home Buyers Grant with applications for established grants falling from 1,513 in September to 1,230 in November.
Current reiwa.com data for October and November indicate that dwelling sales have maintained a similar level for the past eight months despite fewer first home buyers.
"First home buyers have been replaced by trade-up buyers purchasing more expensive properties. Our reiwa.com data indicate that sales in the more expensive price ranges increased noticeably during October and November, with the $600,000 to $750,000 range showing the strongest rise, followed by the $750,000 to $1 million and the $1 to $2 million range.
"By contrast, there was just a small increase in sales turnover in the more typical $450,000 to $500,000 range of homes," Mr Bourke said.
Mr Bourke said that while there is increasing investor activity in the more affordable end of the market which is replacing first home buyer activity, it had not been sufficient to halt a fall in turnover in all price ranges below the median.
"Homes under the median price have seen a decline in sales during October and November when compared to the September quarter".
"Stock is being replenished as quickly as it is being sold, with the availability of property for sale increasing marginally over the past two months, lifting from 11,200 properties at the end of September to 11,500 at the end of November," Mr Bourke said.
In a show of increasing confidence in the new housing sector the number of blocks of land on the market has fallen from just over 2,000 in September to around 1,750 in November.
"We have seen building approvals increase across the year and recent data from the ABS are showing that new dwelling starts increased by 13.8 per cent in the September quarter," Mr Bourke said.
According to REIWA the local rental market has seen very little movement in the rental vacancy rate, currently sitting at 4.6 per cent. This is down marginally from 4.8 per cent in September but is still above average for Perth.
"While there is a lot of rental stock on the market looking for tenants the overall median rent in Perth of $360 per week has remained steady at that level since December last year.
"All of these indicators suggest the local housing system is operating at normal levels with some capacity to absorb any additional demand that may be generated from the improving economic outlook over the coming 12 months," Mr Bourke said.
Perth housing back at peak prices
16 December 2009
Perth's median house price is heading back to the peak level it achieved in December, 2007 according to preliminary research by the Real Estate Institute of Western Australia.
REIWA President, Alan Bourke, said the Institute' figures were showing that strong sales turnover among more expensive homes was pulling the metropolitan median price back up to $475,000.
"It's really quite amazing what can happen in a year and to see how effective the Commonwealth's stimulus strategies have been. This time last year the median sale price had fallen to $420k," Mr Bourke said.
Latest data from the Office of State Revenue show that the market is weaning itself off the First Home Buyers Grant with applications for established grants falling from 1,513 in September to 1,230 in November.
Current reiwa.com data for October and November indicate that dwelling sales have maintained a similar level for the past eight months despite fewer first home buyers.
"First home buyers have been replaced by trade-up buyers purchasing more expensive properties. Our reiwa.com data indicate that sales in the more expensive price ranges increased noticeably during October and November, with the $600,000 to $750,000 range showing the strongest rise, followed by the $750,000 to $1 million and the $1 to $2 million range.
"By contrast, there was just a small increase in sales turnover in the more typical $450,000 to $500,000 range of homes," Mr Bourke said.
Mr Bourke said that while there is increasing investor activity in the more affordable end of the market which is replacing first home buyer activity, it had not been sufficient to halt a fall in turnover in all price ranges below the median.
"Homes under the median price have seen a decline in sales during October and November when compared to the September quarter".
"Stock is being replenished as quickly as it is being sold, with the availability of property for sale increasing marginally over the past two months, lifting from 11,200 properties at the end of September to 11,500 at the end of November," Mr Bourke said.
In a show of increasing confidence in the new housing sector the number of blocks of land on the market has fallen from just over 2,000 in September to around 1,750 in November.
"We have seen building approvals increase across the year and recent data from the ABS are showing that new dwelling starts increased by 13.8 per cent in the September quarter," Mr Bourke said.
According to REIWA the local rental market has seen very little movement in the rental vacancy rate, currently sitting at 4.6 per cent. This is down marginally from 4.8 per cent in September but is still above average for Perth.
"While there is a lot of rental stock on the market looking for tenants the overall median rent in Perth of $360 per week has remained steady at that level since December last year.
"All of these indicators suggest the local housing system is operating at normal levels with some capacity to absorb any additional demand that may be generated from the improving economic outlook over the coming 12 months," Mr Bourke said.
Tuesday, December 1, 2009
Up again - Cash rate to 3.75%
The Reserve Bank of Australia has increased interest rates for the third consecutive time this morning bringing the cash rate up to 3.75%. A $300,000 loan over 25 years will now require $47/month more. First home buyers will also see another $7,000 wiped out from the first home buyer's grant at the end of December. This is a good sign for the Australian economy and the AUD has reflected that, rising to US91.5c following the RBA announcement.
Monday, November 30, 2009
Perth houses back up beyond $500,000
The median house price in Perth has risen 6% over the past year to a new high of $498,541 (houses average $505,954 and units $471,331).
The median house price across Australia has risen almost 10% to $496,398 according to an industry survey. Good news for renters of units as Perth has the shortest number of vacant days with an average of 19 days before being occupied again.
HomeInPerth Traffic Increases
In another sign of interest in the real estate market despite the cuts in the first homebuyers grant, September unique traffic to HomeInPerth doubled that of August and then increased another 40% in October. We hope that this website has been of some benefit to you. In return, can we ask if you could leave a comment here and tell us a little about yourself? First homebuyer? Looking for an investment? Upgrading or just curious? Thanks!
The median house price across Australia has risen almost 10% to $496,398 according to an industry survey. Good news for renters of units as Perth has the shortest number of vacant days with an average of 19 days before being occupied again.
HomeInPerth Traffic Increases
In another sign of interest in the real estate market despite the cuts in the first homebuyers grant, September unique traffic to HomeInPerth doubled that of August and then increased another 40% in October. We hope that this website has been of some benefit to you. In return, can we ask if you could leave a comment here and tell us a little about yourself? First homebuyer? Looking for an investment? Upgrading or just curious? Thanks!
Tuesday, November 3, 2009
Melbourne Cup Interest Rate Rise to 3.50%
On the day of the Melbourne Cup, the RBA surprised no one with their increase in interest rates by 25 basis points to 3.50%. The ANZ Bank and Commonwealth Bank of Australia followed by increasing their interest rates by the same amount shortly after the RBA announcement. ANZ variable rate now stands at 6.31%
Friday, October 30, 2009
RP Data reports drop in Perth house prices
SEPTEMBER NATIONAL HOME VALUE RESULTS
RP Data‐Rismark Index
MEDIA RELEASE
Released Friday 30 October 2009
Growth in home values flat in month of September; Quarterly result lowest in 2009
Australia's housing recovery moved sideways in the month of September with national home values flat after quarterly capital gains peaked in the March quarter
According to the 'market-leading' RP Data-Rismark National Capital City Home Value Index - which is the only monthly index published by the RBA in the Statement on Monetary Policy - home values were largely unchanged in September, increasing by just 0.1 per cent. This is the lowest monthly result to date in 2009.
On a quarterly basis, Australian home values rose by a healthy 2.5 per cent, largely driven by gains in the months of July (+0.7%) and August (+1.8%).* Contrary to some other claims, the September quarter result was actually slightly less than the first two quarters of the year.
According to rpdata.com's Research Director, Tim Lawless, "the strong first quarter rise of +2.8 per cent was followed by slightly lower results in the second quarter (+2.6%) and the third quarter (+2.5%). This is consistent with the winding back of first time buyers and a return to more sustainable growth outcomes."
Rismark International Managing Director Christopher Joye said, "The growth in Australian home values in 2009 has been remarkably consistent since their nadir in December 2008 with cumulative capital gains in the first nine months of 2009 of 8.1 per cent following on from the 3.8 per cent peak-to-trough falls in 2008."
Tim Lawless said that the buoyant market conditions in the first half of the year should be superseded by more normal growth rates.
"In all likelihood, the national market will return to more sustainable growth rates as rising mortgage rates dampen the recent exuberance," he said.
Christopher Joye added, "We are projecting materially lower and more durable rates of house price growth going forward as home loan rates rise towards 7 per cent and beyond over 2010."
"Since the RBA was aware of our August numbers when they lifted rates by 0.25 per cent one would think that the flat house price growth in September and the lower overall quarterly rate reduces the probability of a more aggressive 0.50 per cent hike at the RBA's next meeting. The most important take-away here is that there is no evidence of accelerating house price growth" he said.
While the index results reveal that the national market was flat in the month of September, this conceals very different city-by-city stories that have played out over the course of 2009.
Melbourne, Sydney, Darwin and Canberra all experienced significant capital appreciation in September while Brisbane, Adelaide and Perth registered flat to negative outcomes.**
For the three months of the September quarter, Melbourne (+4.8 per cent), Canberra (+3.8 per cent) and Sydney (+2.8 per cent) home vales all outperformed the national market (+2.5 per cent). In contrast, Perth (-1.4 per cent), Brisbane (0.0 per cent) and Adelaide (+2.4 per cent) all underperformed. The standout in the third quarter has once again been Darwin with impressive 6 3 per cent growth.
Tim Lawless pointed out that the underperforming cities in 2009 have been some of the best performers over the long-run.
"Over the last seven years, which is the average hold period for a property, Perth values have recorded an annual gain of 13.5 per cent, Brisbane values are up 10.1 per cent per annum and Adelaide values have increased 9.7 per cent each year. In contrast, the overall national rate of growth has been 7.1 per cent per annum."
The RP Data Rismark National Home Value Index results show that while the performance of detached houses and units have been similar over the September quarter, units have outperformed houses over the last nine months consistent with the impact of first home buyers earlier in the year.
Over the September quarter Australian house values gained 2.5 per cent while unit values were up 2.4 per cent. Over the nine months to end September, unit values increased by 8.8 per cent while detached house values rose by 7.9 per cent.
Mr Lawless said that the stronger capital gains associated with units may be related to the ongoing scarcity of new unit developments, coupled with lower entry costs to the market that units provide to price sensitive buyers.
Australian rental yields were unchanged in the September quarter with the gross annualised rental yield for units equal to 5.1 per cent. Rental yields on detached houses have also been static at a slightly lower 4.3 per cent.
The RP Data-Rismark National Home Value Index was the first index to identify the recovery in Australian house prices at the start of 2009. Other less sophisticated 'median price' indices have lagged behind. For example, the ABS index did not record a rebound in Australian home values until the second quarter of 2009. Analysts should be wary of inferring too much into the high growth recorded by alternative indices in the second and third quarters of 2009 as they are likely to be catching up to the more consistent appreciation registered by the RP Data-Rismark Index since January 2009.
In this context, Christopher Joye commented, "Other house price indices tend to be lagging indicators. They trailed the RP Data-Rismark Index by a good quarter as the market recovered in January 2009 and the booming growth they are now claiming relate more to past than present conditions. The best publicly available guide to real-time house price conditions is the RP Data-Rismark hedonic measure."
In a speech two weeks ago, the Governor of the RBA, Glenn Stevens, was asked whether he thought Australia was suffering from a house price bubble. His response is enclosed as follows:
"Well, a lot of people have bandied the word "bubble" around; I'm not one of them, let me be clear. Even though I'm often interpreted as having said that, I haven't said that. It is a fact, though, that housing prices have started to rise again...That is part of the economic picture - the general economic picture - that monetary policy looks at...That's not the same as saying that, because housing prices are rising, that itself is going to drive a rate increase. We haven't said that. In fact, I've said that I wouldn't expect that, per se, to be the case."
On the subject of whether Australian housing is unduly expensive, the IMF commented in its October 2009 World Economic Outlook Report: "In the case of Australia, if the impact of long-term migration on housing demand is taken into account, the results do not produce evidence of a significant overvaluation of house prices."
The IMF also concludes that: "If past is prologue, these estimates suggest that...the [housing market] corrections in Australia and the United States are close to complete..."
IMF analysis released earlier this year showed that between 1997 and 2009 real house price growth in Australia had been no greater than the median comparable country selected by the IMF in a survey of Australia's peers. The IMF also found that growth in Australian house price-to-income ratios over the period 1997 to 2009 had actually been less than the same metrics in the UK, Ireland, Spain and NZ. Indeed, Australia's ratio is no greater than it was at the beginning of this decade;
*RP Data-Rismark's previous "indicative" estimate for the month of August of +1.9% has hardly changed (now +1.8%) based on the latest data.
**The indicative "monthly" estimates for Brisbane, Adelaide, Perth and Darwin are somewhat more volatile than the bigger cities such as Sydney and Melbourne on a month-to-month basis due to the lower underlying liquidity in these markets (think of it as akin to comparing the volatility of a small cap stock with a blue chip company).
**Readers should be aware of three technical points. First, the monthly RP Data-Rismark Hedonic Index compares month-to-month index results. For example, the first quarter of 2009 index results compare the end of March index with the end of December index. Another way to measure index returns is to combine all the months together in a quarter and compare them to the previous quarter's pooled index. So you would combine all sales in January, February and March and compute an index value. You would then compare this to the pooled October, November, and December index value. The problem here is that because many home sales are reported by the Valuer Generals offices with a 1-3 month delay, the sample sizes in the more recent months are smaller than the earlier month. So in the first quarter of 2009, January's sales will dominate because there are more January sales than February and March. In practice, however, there will in the end be a much higher number of sales in February and March. This is the approach used by the ABS. To overcome this problem, RP Data-Rismark treats each month separately. The other issue is that the ABS uses a stratified median price index. If more lower-valued homes are selling because of an increase in, say, first time buyer activity, median price indices can report lower returns when in fact house prices may be rising. RP Data-Rismark's hedonic regression method overcomes this problem. Finally, unlike the ABS Index, which excludes terraces, semi-detached homes and apartments, the RP Data-Rismark Hedonic Index includes all properties.
RP Data‐Rismark Index
MEDIA RELEASE
Released Friday 30 October 2009
Growth in home values flat in month of September; Quarterly result lowest in 2009
Australia's housing recovery moved sideways in the month of September with national home values flat after quarterly capital gains peaked in the March quarter
According to the 'market-leading' RP Data-Rismark National Capital City Home Value Index - which is the only monthly index published by the RBA in the Statement on Monetary Policy - home values were largely unchanged in September, increasing by just 0.1 per cent. This is the lowest monthly result to date in 2009.
On a quarterly basis, Australian home values rose by a healthy 2.5 per cent, largely driven by gains in the months of July (+0.7%) and August (+1.8%).* Contrary to some other claims, the September quarter result was actually slightly less than the first two quarters of the year.
According to rpdata.com's Research Director, Tim Lawless, "the strong first quarter rise of +2.8 per cent was followed by slightly lower results in the second quarter (+2.6%) and the third quarter (+2.5%). This is consistent with the winding back of first time buyers and a return to more sustainable growth outcomes."
Rismark International Managing Director Christopher Joye said, "The growth in Australian home values in 2009 has been remarkably consistent since their nadir in December 2008 with cumulative capital gains in the first nine months of 2009 of 8.1 per cent following on from the 3.8 per cent peak-to-trough falls in 2008."
Tim Lawless said that the buoyant market conditions in the first half of the year should be superseded by more normal growth rates.
"In all likelihood, the national market will return to more sustainable growth rates as rising mortgage rates dampen the recent exuberance," he said.
Christopher Joye added, "We are projecting materially lower and more durable rates of house price growth going forward as home loan rates rise towards 7 per cent and beyond over 2010."
"Since the RBA was aware of our August numbers when they lifted rates by 0.25 per cent one would think that the flat house price growth in September and the lower overall quarterly rate reduces the probability of a more aggressive 0.50 per cent hike at the RBA's next meeting. The most important take-away here is that there is no evidence of accelerating house price growth" he said.
While the index results reveal that the national market was flat in the month of September, this conceals very different city-by-city stories that have played out over the course of 2009.
Melbourne, Sydney, Darwin and Canberra all experienced significant capital appreciation in September while Brisbane, Adelaide and Perth registered flat to negative outcomes.**
For the three months of the September quarter, Melbourne (+4.8 per cent), Canberra (+3.8 per cent) and Sydney (+2.8 per cent) home vales all outperformed the national market (+2.5 per cent). In contrast, Perth (-1.4 per cent), Brisbane (0.0 per cent) and Adelaide (+2.4 per cent) all underperformed. The standout in the third quarter has once again been Darwin with impressive 6 3 per cent growth.
Tim Lawless pointed out that the underperforming cities in 2009 have been some of the best performers over the long-run.
"Over the last seven years, which is the average hold period for a property, Perth values have recorded an annual gain of 13.5 per cent, Brisbane values are up 10.1 per cent per annum and Adelaide values have increased 9.7 per cent each year. In contrast, the overall national rate of growth has been 7.1 per cent per annum."
The RP Data Rismark National Home Value Index results show that while the performance of detached houses and units have been similar over the September quarter, units have outperformed houses over the last nine months consistent with the impact of first home buyers earlier in the year.
Over the September quarter Australian house values gained 2.5 per cent while unit values were up 2.4 per cent. Over the nine months to end September, unit values increased by 8.8 per cent while detached house values rose by 7.9 per cent.
Mr Lawless said that the stronger capital gains associated with units may be related to the ongoing scarcity of new unit developments, coupled with lower entry costs to the market that units provide to price sensitive buyers.
Australian rental yields were unchanged in the September quarter with the gross annualised rental yield for units equal to 5.1 per cent. Rental yields on detached houses have also been static at a slightly lower 4.3 per cent.
The RP Data-Rismark National Home Value Index was the first index to identify the recovery in Australian house prices at the start of 2009. Other less sophisticated 'median price' indices have lagged behind. For example, the ABS index did not record a rebound in Australian home values until the second quarter of 2009. Analysts should be wary of inferring too much into the high growth recorded by alternative indices in the second and third quarters of 2009 as they are likely to be catching up to the more consistent appreciation registered by the RP Data-Rismark Index since January 2009.
In this context, Christopher Joye commented, "Other house price indices tend to be lagging indicators. They trailed the RP Data-Rismark Index by a good quarter as the market recovered in January 2009 and the booming growth they are now claiming relate more to past than present conditions. The best publicly available guide to real-time house price conditions is the RP Data-Rismark hedonic measure."
In a speech two weeks ago, the Governor of the RBA, Glenn Stevens, was asked whether he thought Australia was suffering from a house price bubble. His response is enclosed as follows:
"Well, a lot of people have bandied the word "bubble" around; I'm not one of them, let me be clear. Even though I'm often interpreted as having said that, I haven't said that. It is a fact, though, that housing prices have started to rise again...That is part of the economic picture - the general economic picture - that monetary policy looks at...That's not the same as saying that, because housing prices are rising, that itself is going to drive a rate increase. We haven't said that. In fact, I've said that I wouldn't expect that, per se, to be the case."
On the subject of whether Australian housing is unduly expensive, the IMF commented in its October 2009 World Economic Outlook Report: "In the case of Australia, if the impact of long-term migration on housing demand is taken into account, the results do not produce evidence of a significant overvaluation of house prices."
The IMF also concludes that: "If past is prologue, these estimates suggest that...the [housing market] corrections in Australia and the United States are close to complete..."
IMF analysis released earlier this year showed that between 1997 and 2009 real house price growth in Australia had been no greater than the median comparable country selected by the IMF in a survey of Australia's peers. The IMF also found that growth in Australian house price-to-income ratios over the period 1997 to 2009 had actually been less than the same metrics in the UK, Ireland, Spain and NZ. Indeed, Australia's ratio is no greater than it was at the beginning of this decade;
*RP Data-Rismark's previous "indicative" estimate for the month of August of +1.9% has hardly changed (now +1.8%) based on the latest data.
**The indicative "monthly" estimates for Brisbane, Adelaide, Perth and Darwin are somewhat more volatile than the bigger cities such as Sydney and Melbourne on a month-to-month basis due to the lower underlying liquidity in these markets (think of it as akin to comparing the volatility of a small cap stock with a blue chip company).
**Readers should be aware of three technical points. First, the monthly RP Data-Rismark Hedonic Index compares month-to-month index results. For example, the first quarter of 2009 index results compare the end of March index with the end of December index. Another way to measure index returns is to combine all the months together in a quarter and compare them to the previous quarter's pooled index. So you would combine all sales in January, February and March and compute an index value. You would then compare this to the pooled October, November, and December index value. The problem here is that because many home sales are reported by the Valuer Generals offices with a 1-3 month delay, the sample sizes in the more recent months are smaller than the earlier month. So in the first quarter of 2009, January's sales will dominate because there are more January sales than February and March. In practice, however, there will in the end be a much higher number of sales in February and March. This is the approach used by the ABS. To overcome this problem, RP Data-Rismark treats each month separately. The other issue is that the ABS uses a stratified median price index. If more lower-valued homes are selling because of an increase in, say, first time buyer activity, median price indices can report lower returns when in fact house prices may be rising. RP Data-Rismark's hedonic regression method overcomes this problem. Finally, unlike the ABS Index, which excludes terraces, semi-detached homes and apartments, the RP Data-Rismark Hedonic Index includes all properties.
Monday, October 19, 2009
First Homebuyers Target Canning Vale
In an article by WA Business News, Department of Treasury and Finance has revealed that applications for property under the first home buyer's grant has been highest in the following suburbs:
183 applications for Canning Vale,
157 applications for Baldivis
116 applications for Ellenbrook
101 applications for Butler
85 applications for Aubin Grove
Overall, the state government received 7,596 applications from buyers seeking the first home owners grant during the September quarter, with 4,341 applications received for established homes and 3,255 for new dwellings.
183 applications for Canning Vale,
157 applications for Baldivis
116 applications for Ellenbrook
101 applications for Butler
85 applications for Aubin Grove
Overall, the state government received 7,596 applications from buyers seeking the first home owners grant during the September quarter, with 4,341 applications received for established homes and 3,255 for new dwellings.
Thursday, October 15, 2009
Perth Rent Drops with New Houses
New media release from the Real Estate Institute of WA has revealed a drop in the median rental prices in Perth:
Preliminary data for the September quarter released last night by the Real Estate Institute of Western Australia, shows that the vacancy rate for available rental properties in Perth has jumped significantly to 4.8 per cent.
Newly elected REIWA President Alan Bourke said this was the highest vacancy rate in 14 years, when it reached 5.4 per cent back in December of 1995.
The overall median rent in Perth remains steady at $360 per week, however median rents for units alone have dropped by just over 1 per cent, or $5, to $355 per week.
Mr Bourke attributed the slack vacancy rate to two key factors.
"The very strong first home buyer activity over the last nine months has seen many renters move into a home of their own, freeing up their previous property back into the rental market.
"In addition to this, data for dwelling commencements in the June quarter shows that nearly 1,600 new units and apartments were completed, along with 4,660 houses. Even so, there are still 16,700 dwellings currently under construction, including 5,800 units and apartments," Mr Bourke said.
Preliminary data for the September quarter released last night by the Real Estate Institute of Western Australia, shows that the vacancy rate for available rental properties in Perth has jumped significantly to 4.8 per cent.
Newly elected REIWA President Alan Bourke said this was the highest vacancy rate in 14 years, when it reached 5.4 per cent back in December of 1995.
The overall median rent in Perth remains steady at $360 per week, however median rents for units alone have dropped by just over 1 per cent, or $5, to $355 per week.
Mr Bourke attributed the slack vacancy rate to two key factors.
"The very strong first home buyer activity over the last nine months has seen many renters move into a home of their own, freeing up their previous property back into the rental market.
"In addition to this, data for dwelling commencements in the June quarter shows that nearly 1,600 new units and apartments were completed, along with 4,660 houses. Even so, there are still 16,700 dwellings currently under construction, including 5,800 units and apartments," Mr Bourke said.
Tuesday, October 6, 2009
Second blow to First Home Buyers - Interest Rates up
Only six days after the first homebuyers grant was cut by $7000, the Reserve Bank of Australia has announced today an increase in the official cash rate by 25 basis points to 3.25%, which will increase household repayments by $40 a month assuming a $300,000 home loan.
The Aussie dollar is up to US$0.884 this afternoon in response to the news.
The Aussie dollar is up to US$0.884 this afternoon in response to the news.
Friday, October 2, 2009
2009 so far for Australian house prices
Across Australia, the average house price has gone up 1.9% in August.
For the year to August, house prices in:
For the year to August, house prices in:
- Melbourne increased by 11.6 per cent to a median price of $467,280.
- Darwin increased by 9.7 per cent to a median price of $461,983.
- Sydney increased by 8.6 per cent to a median price of $546,867.
- Canberra increased by 6.7 per cent to a median price of $484,925.
- Brisbane increased by 5.2 per cent to a median price of $443,197.
- Perth increased by 4.1 per cent to a median price of $489,154.
- Adelaide increased by 3.1 per cent to $407,227.
- Hobart increased by 2.7 per cent to a median price of $311,148
Experts tip two consecutive rate rises coming up
Next week, the Reserve Bank will meet to decide the fate of interest rates for October. The experts are tipping that the interest rate will remain the same next week but will rise in both November and December. Assuming a home loan of $300,000, every 25 basis points that the interest rate increases on a 25 year mortgage will increase the monthly repayment by $40.
Tuesday, September 15, 2009
30 September 2009 - $7000 off your first homebuyer grant
Just a reminder...
Eligible first home buyers who sign a contract to purchase an existing home by 30 September 2009 will receive an extra $7000, taking the total lump sum payment (including the First Home Owner Grant) to $14,000.
Eligible first home buyers who sign a contract to construct or purchase a new home by 30 September 2009 will receive an extra $14,000, taking the total lump sum payment (including the First Home Owner Grant) to $21,000.
The First Home Owners Boost payment will change from 1 October 2009 and cease on the 31 December 2009.
Leave a comment below if you are one rushing to buy a house before 30 September or 31 December.
Eligible first home buyers who sign a contract to purchase an existing home by 30 September 2009 will receive an extra $7000, taking the total lump sum payment (including the First Home Owner Grant) to $14,000.
Eligible first home buyers who sign a contract to construct or purchase a new home by 30 September 2009 will receive an extra $14,000, taking the total lump sum payment (including the First Home Owner Grant) to $21,000.
The First Home Owners Boost payment will change from 1 October 2009 and cease on the 31 December 2009.
Leave a comment below if you are one rushing to buy a house before 30 September or 31 December.
WA housing starts drop 18% in 2008-09
Low interest rates and a more generous government housing grant have failed to lift the rate of new home building, with housing starts in WA falling by a larger than forecast 18.1 per cent in 2008/09.
The Australian Bureau of Statistics dwelling commencements report for the June quarter showed that home starts in WA fell by a seasonally adjusted 6.3 per cent to 4,345 units.
Over the 2009 financial year, housing starts fell 18.1 per cent in WA, according to CommSec. The Housing Industry Association had yesterday forecast a fall of 15 per cent
The Australian Bureau of Statistics dwelling commencements report for the June quarter showed that home starts in WA fell by a seasonally adjusted 6.3 per cent to 4,345 units.
Over the 2009 financial year, housing starts fell 18.1 per cent in WA, according to CommSec. The Housing Industry Association had yesterday forecast a fall of 15 per cent
Wednesday, July 29, 2009
Perth's Best Suburbs according to experts (part 2)
Here is part two of the post we had on what the experts are tipping to be the must see suburbs in Perth.
Travis Coleman, valuations manager, Propell National Valuers
Safety Bay
YOU can still buy established houses in this coastal suburb for less than $400,000. Block sizes can be more than 800sq m. The area is undergoing urban renewal, with a major redevelopment
planned for the nearby Waikiki Hotel.
Warnbro
Another Rockingham coastal suburb that has a large selection of affordable properties for sale.
The suburb has the attraction of having a railway station nearby. Older-style homes that are not
yet renovated can be bought for near their land value. The spread of urban development in
areas farther inland, such as Baldivis, should make coastal homes in areas such as Warnbro more valuable over the longer term.
South Perth/Como
A prime inner-city location where you can still buy older townhouses and apartments for under $500,000. Historically, property owners in this area of Perth have enjoyed high levels of capital
growth. Astute investors should target older-style rental properties that appear ‘‘tired’’. These properties can be transformed by some minor improvements, such as paint and carpets.
The suburb has easy access to the city centre and a high level of social infrastructure, including schools and parks.
Greenwood
A well-established suburb in the northern coastal area where the median house price is $440,000. House prices in the area are very affordable relative to its distance to the city centre. The suburb also has the attraction of having a railway station. Block sizes are large and land values
should continue to increase as a result of urban developments to the north and east of
Greenwood.
Beldon/Heathridge
Another very affordable coastal area of Perth where the median house price is under $400,000.
Properties in these nearby suburbs have recorded high levels of capital growth over the last decade, with an annual price growth rate of over 13.1 per cent. The homes are generally on big blocks and first-home buyers should benefit from rising land values because of the scarcity of building blocks in this area of Perth.
James Limnios, chief executive, Limnios Property Group
East Perth
ASTUTE first-home buyers can buy onebedroom apartments in East Perth for under $400,000. After significant private and government investment, East Perth is now becoming a very desirable area in which to live. Social infrastructure, such as shopping, is also improving. The median price of a house in East Perth has increased 16.6 per cent on average each year over the past 10 years.
Northbridge
An inner-city area of Perth that will directly benefit from the massive new investment planned after the sinking of the railway line, which is now finally a reality after more than 40 years in the planning. There is still a large selection of two-bedroom, two-bathroom apartments in Northbridge for couples looking for larger, inner-city homes.
Tuart Hill
One of the more affordable near-city suburbs, which offers easy access to the city centre.
There is a good selection of established villas and townhouses in Tuart Hill for under $500,000. You can even secure a smaller villa for about $300,000. The suburb has good public transport links to the city centre and a high level of social infrastructure, such as schools and shopping. The
demand for homes in Tuart Hill is underlined by the fact that the Limnios Property Group is now achieving record prices for homes in the area.
Mt Lawley
One of the premier suburbs in Perth, which still has very affordable options for first-home buyers. Older-style two-bedroom, onebathroom apartments can be bought for about $300,000. With
cosmetic renovations, the value of these olderstyle apartments can be substantially enhanced. The median price of a house in Mt Lawley has increased by about 12 per cent on average each year over the last decade.
Maylands
A near-city suburb that also has the benefits of a pubic railway system, which residents can use to access the city centre. Maylands is also growing in popularity because of its riverside location and the growing focus on ‘‘lifestyle’’. There is a big selection of apartments and villas in Maylands
for under $500,000.
YOU can still buy established houses in this coastal suburb for less than $400,000. Block sizes can be more than 800sq m. The area is undergoing urban renewal, with a major redevelopment
planned for the nearby Waikiki Hotel.
Warnbro
Another Rockingham coastal suburb that has a large selection of affordable properties for sale.
The suburb has the attraction of having a railway station nearby. Older-style homes that are not
yet renovated can be bought for near their land value. The spread of urban development in
areas farther inland, such as Baldivis, should make coastal homes in areas such as Warnbro more valuable over the longer term.
South Perth/Como
A prime inner-city location where you can still buy older townhouses and apartments for under $500,000. Historically, property owners in this area of Perth have enjoyed high levels of capital
growth. Astute investors should target older-style rental properties that appear ‘‘tired’’. These properties can be transformed by some minor improvements, such as paint and carpets.
The suburb has easy access to the city centre and a high level of social infrastructure, including schools and parks.
Greenwood
A well-established suburb in the northern coastal area where the median house price is $440,000. House prices in the area are very affordable relative to its distance to the city centre. The suburb also has the attraction of having a railway station. Block sizes are large and land values
should continue to increase as a result of urban developments to the north and east of
Greenwood.
Beldon/Heathridge
Another very affordable coastal area of Perth where the median house price is under $400,000.
Properties in these nearby suburbs have recorded high levels of capital growth over the last decade, with an annual price growth rate of over 13.1 per cent. The homes are generally on big blocks and first-home buyers should benefit from rising land values because of the scarcity of building blocks in this area of Perth.
James Limnios, chief executive, Limnios Property Group
East Perth
ASTUTE first-home buyers can buy onebedroom apartments in East Perth for under $400,000. After significant private and government investment, East Perth is now becoming a very desirable area in which to live. Social infrastructure, such as shopping, is also improving. The median price of a house in East Perth has increased 16.6 per cent on average each year over the past 10 years.
Northbridge
An inner-city area of Perth that will directly benefit from the massive new investment planned after the sinking of the railway line, which is now finally a reality after more than 40 years in the planning. There is still a large selection of two-bedroom, two-bathroom apartments in Northbridge for couples looking for larger, inner-city homes.
Tuart Hill
One of the more affordable near-city suburbs, which offers easy access to the city centre.
There is a good selection of established villas and townhouses in Tuart Hill for under $500,000. You can even secure a smaller villa for about $300,000. The suburb has good public transport links to the city centre and a high level of social infrastructure, such as schools and shopping. The
demand for homes in Tuart Hill is underlined by the fact that the Limnios Property Group is now achieving record prices for homes in the area.
Mt Lawley
One of the premier suburbs in Perth, which still has very affordable options for first-home buyers. Older-style two-bedroom, onebathroom apartments can be bought for about $300,000. With
cosmetic renovations, the value of these olderstyle apartments can be substantially enhanced. The median price of a house in Mt Lawley has increased by about 12 per cent on average each year over the last decade.
Maylands
A near-city suburb that also has the benefits of a pubic railway system, which residents can use to access the city centre. Maylands is also growing in popularity because of its riverside location and the growing focus on ‘‘lifestyle’’. There is a big selection of apartments and villas in Maylands
for under $500,000.
Tuesday, July 28, 2009
Perth's best suburbs experts choose
Taken from www.news.com.au/perthnow is a list of expert tips for buying a home in Perth:
Alan Hancock, chairman, Ausnet Real Estate Group
Greenfields
ONE of the more affordable suburbs in Mandurah where you can still buy older homes for under
$300,000. The suburb is near the Mandurah District Hospital. Rents in the area are also high, which means that at a later stage you can rent out the home if you
decide to upgrade to another property.
Medina
One of the cheapest places in Perth to buy a house. There is a growing selection of established threebedroom, onebathroom and twobedroom, onebathroom houses in the suburb for about
$250,000. Over the long term, property values in Medina will benefit from the major investment
planned for the Kwinana town centre.
Thornlie
An undervalued suburb next to the more expensive Canning Vale. It has a railway station providing easy access to the city centre and a high level of social infrastructure, such as schools and shops. You can buy a three-by-one house in Thornlie for under $350,000, and a four-by-one house for
under $400,000.
Greenfields
ONE of the more affordable suburbs in Mandurah where you can still buy older homes for under
$300,000. The suburb is near the Mandurah District Hospital. Rents in the area are also high, which means that at a later stage you can rent out the home if you
decide to upgrade to another property.
Medina
One of the cheapest places in Perth to buy a house. There is a growing selection of established threebedroom, onebathroom and twobedroom, onebathroom houses in the suburb for about
$250,000. Over the long term, property values in Medina will benefit from the major investment
planned for the Kwinana town centre.
Thornlie
An undervalued suburb next to the more expensive Canning Vale. It has a railway station providing easy access to the city centre and a high level of social infrastructure, such as schools and shops. You can buy a three-by-one house in Thornlie for under $350,000, and a four-by-one house for
under $400,000.
Midland
An established area that has a high level of social infrastructure, including a railway station. It is
undergoing a major transformation, which will make it a more attractive property market over the
coming decade. You can purchase a well-located villa or duplex in Midland for under $300,000.
Ellenbrook
A ‘‘lifestyle’’ suburb in the Swan Valley, which is growing in popularity. It also has improving social
infrastructure. Newer family homes can be bought in Ellenbrook for under $400,000. When you add up the total costs of building a new home, buying a near-new, established property in a well-designed suburb such as Ellenbrook can prove a more attractive option.
Jay Wood, director, pfr.com.au
An established area that has a high level of social infrastructure, including a railway station. It is
undergoing a major transformation, which will make it a more attractive property market over the
coming decade. You can purchase a well-located villa or duplex in Midland for under $300,000.
Ellenbrook
A ‘‘lifestyle’’ suburb in the Swan Valley, which is growing in popularity. It also has improving social
infrastructure. Newer family homes can be bought in Ellenbrook for under $400,000. When you add up the total costs of building a new home, buying a near-new, established property in a well-designed suburb such as Ellenbrook can prove a more attractive option.
Jay Wood, director, pfr.com.au
Victoria Park/East Victoria Park
INNER-CITY areas that will soon rival Subiaco for social infrastructure, such as restaurants and cafes. Older apartments and villas can be bought for under $450,000. The suburbs have
historically delivered high rates of capital growth and can be an important stepping stone for first-home buyers wanting to climb the property ladder.
Cloverdale
An affordable near-city suburb where the median house price is just $400,000. In the past decade, the median price of a house in Cloverdale has increased on average by 13.8 per cent. The suburb has a good selection of older homes that offer redevelopment opportunities. It has a high level of social infrastructure, such as shopping, schools and good transport links to the CBD.
St James
A near-city Perth suburb where older houses on large blocks can still be bought at prices near their land value. The median price of a home in St James is just $420,000. Over the past decade, the annual price of a home in St James has increased on average by 12 per cent. It has a good level of social infrastructure, such as shops and schools, and access to the city centre.
Wembley
One of the most affordable areas in which to buy a property in the near-city area. First-home buyers on a limited budget can still purchase older-style apartments in Wembley for under
$300,000. This suburb can offer a useful stepping stone for first-home buyers into neighbouring
Subiaco. Property owners in Wembley have enjoyed annual capital growth rates of more than 12 per cent on average each year in the last decade.
Palymra
An undervalued suburb in the Fremantle area with property available for under $500,000. The
suburb is near Fremantle and has easy access to the CBD. Many first home buyers have bought in Palymra and later upgraded to neighbouring Bicton and East Fremantle. Over the past 10
years, the annual capital growth for properties in Palymra has been an impressive 12.4 per
cent.
INNER-CITY areas that will soon rival Subiaco for social infrastructure, such as restaurants and cafes. Older apartments and villas can be bought for under $450,000. The suburbs have
historically delivered high rates of capital growth and can be an important stepping stone for first-home buyers wanting to climb the property ladder.
Cloverdale
An affordable near-city suburb where the median house price is just $400,000. In the past decade, the median price of a house in Cloverdale has increased on average by 13.8 per cent. The suburb has a good selection of older homes that offer redevelopment opportunities. It has a high level of social infrastructure, such as shopping, schools and good transport links to the CBD.
St James
A near-city Perth suburb where older houses on large blocks can still be bought at prices near their land value. The median price of a home in St James is just $420,000. Over the past decade, the annual price of a home in St James has increased on average by 12 per cent. It has a good level of social infrastructure, such as shops and schools, and access to the city centre.
Wembley
One of the most affordable areas in which to buy a property in the near-city area. First-home buyers on a limited budget can still purchase older-style apartments in Wembley for under
$300,000. This suburb can offer a useful stepping stone for first-home buyers into neighbouring
Subiaco. Property owners in Wembley have enjoyed annual capital growth rates of more than 12 per cent on average each year in the last decade.
Palymra
An undervalued suburb in the Fremantle area with property available for under $500,000. The
suburb is near Fremantle and has easy access to the CBD. Many first home buyers have bought in Palymra and later upgraded to neighbouring Bicton and East Fremantle. Over the past 10
years, the annual capital growth for properties in Palymra has been an impressive 12.4 per
cent.
Wednesday, July 15, 2009
Dodgy tricks Real Estate Agents use
There are some of us who do not venture into the Real Estate market because our lack of understanding aoubt how the whole industry works. In every business, there are ways that agents charge an "idiots tax" on those who don't know what they are doing. Here are some dirty tricks that are used by real estate agents.
There is an old adage among real-estate agents, ''quote 'em low and watch 'em go. Quote 'em high and watch 'em die". The practice of under quoting is widespread and has surged again in recent months. It is when potential buyers are told a price much lower than a property's true market value and the owner's reserve. Unfortunately, under quoting is rife because it works. Every weekend hopeful buyers are lured to an auction thinking they can afford, for example, $850,000-plus for a four bedroom house in Templestowe, Melbourne, only to be broken hearted when sells for $1.51m, as happened at 45 Taparoo Road last month.
Dirty little secret #2
The reverse of under quoting is over quoting, a ploy some agents use to win business. In this case, agents promise a vendor their house will fetch a price well above its market value, whether to convince them to sell or to beat others for the right to sell it. Once the contract is signed, the agent begins to groom the owner to accept a lower price. Adding even more insult to injury is the fact that many times property is actually sold for less than it is worth. This happens when the agent can not be bothered with the hard yakka to get, for example, an extra 5 per cent for their vendor. Such agents have a churn mentality, simply finding a price the owner will accept, selling the house and moving on to the next campaign.
Dirty little secret #3
Vendors can be cheated in another way too. Very naughty agents have been known to withhold good offers made before auction, even those well above the reserve, for several reasons. Sometimes, the offer comes through another agent at the firm and the original agent doesn't want to share commission. So, the bid is never put to the vendor or is put to them but at less than the real offer to be knocked back. Other times the agency wants to promote its brand by pushing ahead with the auction no matter what. It wants the vendor to spend the full amount on advertising because it is a lighthouse to attract other buyers and sellers to the business.
Vendors can be cheated in another way too. Very naughty agents have been known to withhold good offers made before auction, even those well above the reserve, for several reasons. Sometimes, the offer comes through another agent at the firm and the original agent doesn't want to share commission. So, the bid is never put to the vendor or is put to them but at less than the real offer to be knocked back. Other times the agency wants to promote its brand by pushing ahead with the auction no matter what. It wants the vendor to spend the full amount on advertising because it is a lighthouse to attract other buyers and sellers to the business.
See the other two secrets of dummy bidding and fake buyers at TheWest.com.au.
Friday, July 10, 2009
Perth houses up $15,000?
Preliminary data released today by the Real Estate Institute of Western Australia show that Perth's median sale price for homes grew by $15,000, or around 3.5 per cent, in the June quarter.
This growth rate brings Perth's median house price to around $445,000, on the revised median of $430,000 for March.
REIWA President Rob Druitt said the growth trend was being helped by a return to the market of the trade-up buyers.
"Much of the recovery in the median house price over the last six months can be attributed to increasing trade-up activity, and this is reflected in the distribution of sales tending towards more expensive properties," Mr Druitt said.
This growth rate brings Perth's median house price to around $445,000, on the revised median of $430,000 for March.
REIWA President Rob Druitt said the growth trend was being helped by a return to the market of the trade-up buyers.
"Much of the recovery in the median house price over the last six months can be attributed to increasing trade-up activity, and this is reflected in the distribution of sales tending towards more expensive properties," Mr Druitt said.
Thursday, July 9, 2009
More tips to buying your first home
* Spend time researching all aspects of property market before even looking for an investment property. Issues, such as negative or positive gearing, rental returns and depreciation are key matters that have to be considered by a first time property investor.
* Past trends in property values generally are an indication of future trends and therefore it is wise to examine the long-term capital growth rates of the suburb. REIWA can provide property values trends for most Perth suburbs for the last 10 years at least.
* Take a broad approach to buying an investment property. Most first time property investors buy a property in their local neighbourhood because they are familiar with the area. By taking a narrow approach to the location of the investment property, first time investors therefore severely limit their options.
* Try to target suburbs in lower priced areas which have a higher number of properties for sale. A simple tip is to check the weekend papers and identifying areas which a larger number of newspaper advertisements.
* When you have selected a suburb, don’t make an emotional decision when choosing a specific home. Most first time investors purchase a property they would like to live in. It is important to remember that the investment property must appeal to a tenant who will be paying the rent.
* Check out any planning changes proposed for the suburb. Many local governments are undertaking reviews of zoning which could have a major impact on property values. For example, a property that was purchased for a single residential use and then rezoned by the local council, as a triplex site will increase substantially in value. The planning department of a local government can advise first time investors of any proposed zoning changes.
* Check out any planned infrastructure changes for an area you are interested in buying. For example, an upgrade of a local shopping centre or sitting of a new railway station can have a major impact on local property values. This trend occurred in Rockingham following the extension of the southern freeway.
* Make sure that there are tenants prepared to rent your property. Rental income is a key factor in serving the loan so if you cannot find a tenant then you will have problems keeping the investment property over the longer term.
* Check your finances before you consider buying an investment property. If you have pre-approval finance it will allow you to move more quickly to secure the right investment property.
Tuesday, July 7, 2009
The best rental suburbs in Perth
Recent research has been released that reveals the best yield suburbs for rental income. They are listed below
Suburb, distance from GPO (km), median price, median rent, gross yield (per cent)
Glendalough, 5km, $250,000, $310, 6.3%
Jolimont, 5km, $300,000, $350, 6.1%
West Perth, 2km, $290,000, $330, 5.9%
Stirling, 9km, $520,000, $580, 5.8%
Perth, 1km, $269,500, $300, 5.8%
Houses
Suburb, distance from GPO (km), median price, median rent, gross yield (per cent)
Tuart Hill, 7km, $425,000, $420, 5.1%
Mirrabooka, 10km, $340,000, $330, 5%
Redcliffe, 8km, $415,000, $390, 4.9%
Ashfield, 8km, $385,000, $350, 4.7%
Nollamara, 8km, $390,000, $340, 4.5%
Tuesday, June 30, 2009
May sees drop in WA Home Sales by 13.5%
Western Australia has suffered the largest fall of new home sales in May as national sales declined for the first time in four months, a survey shows.
The number of detached new home sales in the state dropped 13.5 per cent in May, according to figures released by the Housing Industry Association today.
The number of detached new home sales in the state dropped 13.5 per cent in May, according to figures released by the Housing Industry Association today.
Wednesday, June 17, 2009
They want us to build
Two of the nation's leading housing associations along with 30 suppliers and builders have today launched a campaign in Western Australia, encouraging potential home buyers to build. The "Build Now" campaign, spearheaded by the Housing Industry Association (HIA) and the Masters Builders Association, was launched by Housing Minister Troy Buswell. The campaign is a bid by the housing sector to shake off the downturn at a time of historically low interest rates and declining property prices.
I think many builders don't understand the fear of being ripped off that probably puts off most people from building, at the very least me. So many things you hear about going wrong when people build. Maybe if they could think of a strategy to deal with this problem. For example, make a website which is interactive where people at various stages of building can share with each other their own experiences. Otherwise, buying an existing home seems to be an easier option.
Thursday, June 11, 2009
First Home Buyer Tips from a "Loan Man"
I was looking through a website called Not Good Enough and came across some tips from a user by the name of The Loan Man, giving tips to first home buyers about buying their first home.
1) Work out what you can afford if interest rates go up 2%, and dont be talked into anything above what you can afford.
2) Go to an experienced finance broker, as they will know what each banks lending criteria is. You could go to 8 banks and get knocked back but a good broker should have access to at least 2 banks who could do the deal as described above.
3) I would look for an independent broker, not one who is tied to a real estate agent as I would worry about their agenda, is it to get the loan approved so that the real estate agent sells the house or are they looking looking after the buyers needs to make sure they are not getting over committed.
4) Do you research on all houses in the area before signing a contract on property. Don't rush in.
5) Don't over commit yourself, your first home may not be your dream home, but to make money out of the real estate market you need to get into it. Your dream home will come later.
6) Don't believe everything the real estate salesperson tells you, talk to people who have bought houses before, whether it be parents, friends, work mates etc. Some agents talk crap just to get a sale.
7) Don't rush in just because the grant is expiring, as I feel it will drop back to $7,000 from the current $14,000, but when the grant reduces I feel sales of established houses will reduces and prices may drop even further.
8) Start budgeting now and saving for a deposit as this will open up all the banks to you. Try and save monthly what your monthly home loan payment will be, that way if you can save the money you will know that you can well and truly afford the repayments. If you are paying rent try and save the difference between the rent you pay and the loan repayment.
9) Be cautious and dont believe everything you are told.
Thursday, June 4, 2009
How do you choose your Perth suburb?
One of the problems with buying a house is that there are so many of them, where do you start? Many people advise that you should know what you want, as in how many bedrooms, bathrooms and what kind of suburb you want to live in. Question for a first home buyer is, which suburb and how do you pick one? How do you avoid a dodgy suburb?
Here are a few factors that come to mind.
- Crime Rate: One of the most commonly search statistics for buying a house is the crime rate in the suburb. How can you enjoy your house when you are concerned with who is in your backyard?
- Public transport facilities: If you never like catching the bus, perhaps this is one way you can choose a cheaper area which is not well serviced by public transport. Otherwise, having a bus stop outside your house may be a high priority.. just the concern of having people loitering outside your house "catching a bus" and the loss of privacy that comes with that.
- Schools and shops: For some, the corner deli, or now more like the corner Woolworths, is an essential for choosing a house. For others, distance from schools can be a deal maker. Think about what you need, and what you just want.
- Broadband availability: Ha! Bet you didn't think about this one! You can't assume that every house you look at has access to fast broadband. You may need to get Telstra cable at Telstra prices so ask first.
- Friday nights: Have you considered parking your car in the area on a Friday night to see what its like? If someone calls the police, its probably a good sign.
What factors can you think of which many people don't think about when buying a house? Treat us with your dimes of wisdom or your measly two cents.
Monday, June 1, 2009
WA home sales in April drop
WA sales of new homes fell in April, despite national sales rising for the fourth straight month to their highest level in 14 months, new data shows.
The Housing Industry Association (HIA) survey, released today, found new homes sales increased by 0.5 per cent to 8,191 homes, the highest since February, 2008, after a 3.1 per cent rise in March."The combination of low interest rates and the first home boost have lifted prospects for the housing industry, which is expected to convert to a recovery in home building activity from the June quarter of 2009," HIA chief economist Harley Dale said in a statement.
"The leading indicators point to housing as an emerging bright spot in the economy."
But sales in Western Australia fell by four per cent, painting a bleak picture of economic health for the once booming state.
Tuesday, May 26, 2009
4.3 years to save a deposit for Perth Homes
When you take the average income of a 25-34 year old and the median house price in the region, you come up with a calculation about how long it would take someone to save up a deposit on a home. Its not an exact science but a Bankwest research paper released today found that it would take a West Australian couple 4.3 years to save up for a deposit on a home. For the average single West Australian, it would take 6.5 years to save up for a unit deposit.
Fancy a house in Peppermint Grove? That will take a couple over 40 years to save for the deposit, assuming that they put aside 20% of their income to save for a deposit. This is the most expensive place in Australia to start a new house together.
The national average for a couple is 3.7 years. Sydney was the most expensive city for a couple to save for a first deposit on a home, taking 5.2 years, with Melbourne requiring a slug of 4.7 years.
Wednesday, May 20, 2009
Most Expensive in the World
Monte Carlo: Not your first home buyer option
Some new figures coming out give us an indication of where are the most expensive places in the world to buy an apartment.
1. Monte Carlo $US47,578 per square metre. Why? Tax haven for the rich and famous but not enough land to go around.
2. Moscow $US20,853 per square metre. Why? The communism pendulum has swung back the other way with a vengence on the back of high oil prices and economic growth.
3. London $US20,756 per square metre. Why? Everyone wants to be in the capital of the British Empire.
4. Tokyo $US17,998 per square metre. Why? Once again, the capitalism capital of Japan with not much land and too much business.
5. Hong Kong $US16,125 per square metre. Why? Have you seen the size of this place? China's gateway to the Western world is a mix of ex-pats and new Chinese millionaires.
Here's the list thanks to the GlobalPropertyGuide.com
Only Sydney made is as the only Australian representative. No Perth in the top 112 :)MOST EXPENSIVE PROPERTY MARKETS
(based on a 120 sq. m. apartment )COUNTRY CITRY/REGION 1 Monaco Monte Carlo 2 Russia Moscow 3 UK London 4 Japan Tokyo 5 Hong Kong Hong Kong 6 USA New York 7 France Paris 8 Singapore Singapore 9 Italy Rome 10 India Mumbai 28 Australia Sydney
Monday, May 18, 2009
Are you a first home owner looking for a home in Perth?
If you are looking for a house in Perth, please leave a comment here and follow this blog in the next few months as the hunt for a home gets serious. With the first homeowner's grant being reduced later this year, its crunch time for us and it pays to learn from each other. We are not competitors, unless you decide to announce in your comments the house that you really set your heart on. Until then, let's share information.. tips.. and warnings :)
Friday, May 15, 2009
Who was to be a millionaire.. suburb
Seven suburbs have been demoted from the millionaires list, their median prices dropping below the A-class threshold. For the year to February 2009, WA recorded four of the largest falls in median house prices with homes in Ardross losing over 26 per cent of their value to record a price of $772,500, down from $1.05 million. South Fremantle went down 24.8 per cent to a median price of $797,500, Cottesloe lost 23.5 per cent to $785,000 and home values in Rossmoyne dropped 20.6 per cent to $815,000.
Median house prices in Shelley lost 18.9 per cent to $835,000, Sorrento suffered a 17.9 per cent fall to $870,000 and Shenton Park fell 11.2 per cent to $945,500 as normality starts to sink in with some of the boom time suburbs in Perth.
Thursday, May 14, 2009
Federal Budget Impact on Housing - Comsec
So what did the experts get out of the Federal Budget and its impact on housing industry? The following is a brief analysis undertaken by Commonwealth Bank. You can read the rest of it here
Where to for housing?
• The latest data on housing lending was highly encouraging, although substantially driven by the upgraded First Home Owners grant. The number of loans to owner-occupiers hit 13-month highs in March while loans to build
new homes hit seven-year highs.
• Not only are home loans rising, but building approvals have risen solidly for the past two months and home prices are also edging higher. In most parts of the globe, housing markets are becalmed with home prices down 10-20
per cent on a year ago.
• First homebuyers have driven the housing recovery and they will continue to be a driving force until at least the end of the year.
• For builders, tradesmen and building material suppliers, the extension to the first homebuyers grant is clearly good news. The problem for the first home buyers is that the additional demand for established dwellings will
continue to put upward pressure on prices.
• A key reason why the grant is in place for established dwellings is to support home prices. In other countries home prices are slumping. But in Australia, prices have been largely flat, but are now starting to edge higher
again. The stability of house prices is important in supporting consumer wealth, confidence and spending.
• Surprisingly Federal Treasury expects dwelling investment to fall by 2.5 per cent in the current financial year with no change in activity in 2009/10. A strong 11.5 per cent lift in dwelling investment is expected in 2010/11.
Wednesday, May 13, 2009
More time granted to first home buyers
Yesterday, the treasurer has announced in the Federal Budget that
- Until 30 September 2009, first home owners will get the existing $21,000 for new homes and $14,000 for existing homes.
- Between 30 September 2009 and 31 December 2009, first home owners will get $14,000 for new homes and $10,500 for existing homes.
- After 31 December 2009, first home owners will continue to get the reduced amount of $7,000 for new or existing homes.
The idea would be to slowly remove the first home owner "boost" without shocking the system.
Wednesday, May 6, 2009
Still deciding...
Its been quite a few months since this blog has been started. I am still not personally satisfied that the time is right to go into the real estate market. As mentioned earlier, I am a Generation Y, yes, the generation that has it all. We as a generation are starting to worry about the future. For the first time the word uncertainty has crept into our vocab and the strange feeling is still taking a while to get used to.
My personal feeling is to wait after June, see how the market responds to the first home owner grant being reduced or removed. It should cool the market right down and maybe lead to a (amatuer prediction imminent) 50k drop in house prices in Perth. That's just a gut feeling anyway.
Meanwhile many of the househunters have come across this site by looking for crime rates in Perth suburbs. That is a major factor because your home is your castle. People jumping over your fence reduces the "ownership" of your house. And our generation doesn't like sharing (unless its movies or music over the internet).
In terms of my injection to the Perth housing economy, I'm still holding tight.
Monday, May 4, 2009
Perth House Prices Drop 10% in past year
Australian Bureau of Statistics has released new house price figures that show a 3.6% drop in the value of houses in Perth for the January to March 2009 quarter and a drop of 10.1% over the past year. Around the country, the drop in house price was an average of 6.9%.
Sydney -2.9% -7.3%
Melbourne -2.3% -6.7%
Brisbane -1.1% -6.3%
Adelaide -0.8% -1.9%
Perth -3.6% -10.1%
Hobart 0.1% 0.6%
Darwin 2.2% 10.8%
Canberra 0.5% -5.1%
With the possibility of the first home owner grants being removed, there is a chance that this trend will reverse only in the next quarter and house prices freefall after June.
Sydney -2.9% -7.3%
Melbourne -2.3% -6.7%
Brisbane -1.1% -6.3%
Adelaide -0.8% -1.9%
Perth -3.6% -10.1%
Hobart 0.1% 0.6%
Darwin 2.2% 10.8%
Canberra 0.5% -5.1%
With the possibility of the first home owner grants being removed, there is a chance that this trend will reverse only in the next quarter and house prices freefall after June.
Friday, April 24, 2009
First Homebuyer grant stays
As predicted yesterday here on HomeInPerth, insiders to the May budget have indicated that the first homebuyer grant will continue, slightly changed to favour building a new house. Prime Minister Kevin Rudd would not comment on the issue yesterday - prompting Liberals to attack him for "cruelly teasing" couples weighing up their purchasing options.
Thursday, April 23, 2009
First Home Buyer $14000 grant creates average $51,000 more debt
Since then, there have been articles suggesting that first homebuyers may be struggling with their newfound debt.
“We have a potential debt time bomb on our hands. Lured by improved affordability and borrowing power, first time buyers are looking to suburbs and properties that traditionally were not within their reach and taking on more debt without possibly fully appreciating what will happen if and when interest rates go up,” says Peter Boehm CEO Our Home Sweet Home.
No more first homebuyer grant? Banks not coping
Today, the ABC News reported that banks are experiencing delays so long that buyers are missing their settlement dates for the houses. Most of this demand is coming from first homebuyers who today were told that the first homebuyer grant will not continue.
"A combination of factors appears to be to blame for the waiting times, but the frenzy of activity is also focussing attention on the wisdom behind the first homebuyers grant, and there is a growing debate over whether it should be extended."
Personally I think it will be extended. This is just a ploy to keep the Real Estate Market ticking over to the 30th June. If Kevin Rudd made people assume that the grant will not continue, you would see a major slump over the next few months as people take for granted the homebuyers grant.
By saying that it won't be around, he is playing salesman politics appealing to the old sales strategy called "fear of loss". You can expect him to create more demand by reintroducing the homebuyer grant in October or something when the economy free falls. This is not an expert opinion.. just based on what a sly politician would do in Kevin's shoes.
"A combination of factors appears to be to blame for the waiting times, but the frenzy of activity is also focussing attention on the wisdom behind the first homebuyers grant, and there is a growing debate over whether it should be extended."
Personally I think it will be extended. This is just a ploy to keep the Real Estate Market ticking over to the 30th June. If Kevin Rudd made people assume that the grant will not continue, you would see a major slump over the next few months as people take for granted the homebuyers grant.
By saying that it won't be around, he is playing salesman politics appealing to the old sales strategy called "fear of loss". You can expect him to create more demand by reintroducing the homebuyer grant in October or something when the economy free falls. This is not an expert opinion.. just based on what a sly politician would do in Kevin's shoes.
Kevin Rudd ending Homebuyer grants
"The first home owner's boost, as you know, we have indicated that will conclude within a very fixed and finite time frame,''
"It's had strong useful results so far, but I have got to say all good things must come to an end.''
- Kevin Rudd in Perth today
"It's had strong useful results so far, but I have got to say all good things must come to an end.''
- Kevin Rudd in Perth today
Wednesday, April 22, 2009
Perth South of River Most Crime
According to a RAC media release, the following suburbs are the top 10 most affected by burglaries and other property crime. Figures for RAC Burglary rates are based on exposed insurance policies between 01/01/2007 and 31/12/2008. The data only includes suburbs that have more than 500 policies during that time.
Top 10 burglary suburbs:
1. Hilton
2. Koondoola
3. Stratton
4. Caversham
5. Kenwick
6. Brookdale
7. Balga
8. South Lake
9. Bentley
10. Beaconsfield
Top 10 burglary suburbs:
1. Hilton
2. Koondoola
3. Stratton
4. Caversham
5. Kenwick
6. Brookdale
7. Balga
8. South Lake
9. Bentley
10. Beaconsfield
Friday, April 17, 2009
10% off the West Side of Perth
Rent and house prices in the western suburbs in Perth have dropped 10% recently, REIWA has reported. Its not a problem, they say, because the house prices have increased dramatically in the last four years and this is just a correction. Just thought you might want to know as you look for a house in Perth. Article here.
Perth houses start going up $8,000 in Mar qtr
The next six months will be a critical time for the state's housing market which showed 2 per cent growth in the median value of homes in the March quarter.
Preliminary figures released today by the Real Estate Institute of WA show the median home value in Perth jumped by $8,000 to reach $427,000.
First home buyers in the state accounted for 40 per cent of all market activity during the quarter. The more affordable parts of Perth saw mixed results during the quarter with the Armadale-Serpentine median price dropping 2.6 per cent and Rockingham-Kwinana falling by 1.4 per cent. However, Gosnells grew by 3 per cent while the north-west region of Wanneroo jumped by 3.6 per cent.
"The overall sales volume was up 40 per cent in the quarter, back to a level similar to September 2006, just as the housing boom was starting to subside," Mr Druitt said.
"Increased sales activity was experienced across the whole market, however the more affordable price band of $300,000 to $500,000 dominated turnover and provided 57 per cent of all sales."
In the rental market, rents in Perth stabilised during the quarter while softer demand lowered the vacancy rate by 0.6 per cent to 3 per cent.
The median rent for units is $350 per week while for houses it is $370 per week.
- Extracts taken from WA Business News
Be nice to first homebuyers, they're keeping the economy ticking
A recent article suggests that first homebuyers are the ones keeping the economy ticking along in these uncertain times.
And with interest rates destined to go even lower in coming months, more people are likely to take the plunge.
"It's really the only flicker of life out there," Nomura Australia's chief economist Stephen Roberts said.
The standard variable home loan rate stands at under six per cent when just eight months ago it was above nine per cent.
Furthermore, HSBC introduced a 12-month introductory rate of just 3.99 per cent, the lowest level seen since the 1950s.
Money is cheap.
More than 42,000 people have taken up a grant since the government introduced a more generous scheme in October as part of its $10.4 billion stimulus package.
As of January, first-hombuyers made up a record 26.5 per cent of new home loans being granted. "
"THE smattering of economic data since early March suggest first-homebuyers are the only people doing their bit for the Australian economy.
Armed with a generous grant from the government and extremely low mortgage rates, home buyers are piling into the housing market and fulfilling a dream of owning the roof above their heads.And with interest rates destined to go even lower in coming months, more people are likely to take the plunge.
"It's really the only flicker of life out there," Nomura Australia's chief economist Stephen Roberts said.
The standard variable home loan rate stands at under six per cent when just eight months ago it was above nine per cent.
Furthermore, HSBC introduced a 12-month introductory rate of just 3.99 per cent, the lowest level seen since the 1950s.
Money is cheap.
More than 42,000 people have taken up a grant since the government introduced a more generous scheme in October as part of its $10.4 billion stimulus package.
As of January, first-hombuyers made up a record 26.5 per cent of new home loans being granted. "
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