Wednesday, April 24, 2013

Perth Houses Highest Ever at $510,000

Median house prices in Perth are at their highest level ever. Last month, the median house price for Perth was $510,000 which is $5,000 more than the previous peak in 2010. According to this article, most sales were between $600,000 to $700,000 with a good number of houses being sold just under $500,000.

Some of the areas mentioned in the article which had increased sales activity have been areas which first home buyers have been targeting all year such as Gosnells, Armadale, Serpentine-Jarrahdale, Rockingham, Kwinana and Wanneroo. The suburbs just outside of the CBD have faced a shortage of listings, forcing up prices. There have also been reports that real estate agents have been offering $30 Coles vouchers to homeowners that were willing to undergo a valuation on their property.

So where do you stand in the current rush for land? Are you looking to buy? Or looking to sell?

Monday, April 15, 2013

Renting in Perth Scarcer in 2013

It's becoming a pretty tight market for those looking for a home to rent in Perth. REIWA recently announced that the median rent in Perth jumped 12% from last year to $470 per week. The gap between renting an apartment and a house is narrowing in Perth as people become more desperate to find any kind of accommodation to rent, discarding personal preferences in the scramble to be housed. The current median price for a house is $480 per week whereas the median price for a unit is only $30 less at $450 per week. This is in spite of a 50% increase in properties for rent in the past six months!

The first home buyers have started to move from rentals to purchasing a new home but this has been offset by many new migrants coming to Perth from the eastern states and abroad. It will be an interesting year for Perth as the mining boom continues to slow down. Last Friday, it was announced that the $45 billion dollar Browse project by Woodside in the north had been shelved.

Thursday, April 4, 2013

Lowest Number of Perth Homes For Sale

It's been six years since Perth has experienced the house shortage that we are now experiencing, with the number of properties available for sale in Perth dropping 50% in the last 12 months to under 7,000. Actually 5,390 houses and 1,427 units which is a staggering statistic considering that about 1,000 migrants move to WA every week. The Real Estate Institute of WA is calling this a crisis which could cause house prices to suddenly jump up in the coming months.

The median house price has increased in the past three months by 2.8% to a record high of $510,000 which surpasses the prices three years ago. Will people start using the b word again?

Tuesday, April 2, 2013

RBA Keeps Cash Rate Steady for April

At its meeting today, the Board decided to leave the cash rate unchanged at 3.0 per cent.
Global growth is forecast to be a little below average for a time, but the downside risks appear to be reduced. While Europe remains in recession, the United States is experiencing a moderate expansion and growth in China has stabilised at a fairly robust pace. Around Asia generally, growth was dampened by the earlier slowing in China and the weakness in Europe, but again there are signs of stabilisation. Commodity prices have declined somewhat recently, but are still at historically high levels.
Internationally, financial conditions are very accommodative. Risk spreads are narrow and funding conditions for financial institutions have improved. Long-term interest rates faced by highly rated sovereigns, including Australia, remain at exceptionally low levels. Borrowing conditions for large corporations are similarly very attractive. Share prices are substantially above their low points. However, the task of putting private and public finances on sustainable paths in several major countries is far from complete. Accordingly, financial markets remain vulnerable to setbacks.
In Australia, growth was close to trend over 2012, led by very large increases in capital spending in the resources sector, while some other sectors experienced weaker conditions. Looking ahead, the peak in resource investment is drawing close. There will, therefore, be more scope for some other areas of demand to strengthen.
Recent information suggests that moderate growth in private consumption spending is occurring, though a return to the very strong growth of some years ago is unlikely. While the near-term outlook for investment outside the resources sector is relatively subdued, a modest increase is likely to begin over the next year. Dwelling investment is slowly increasing, with rising dwelling prices and high rental yields. Exports of natural resources are strengthening. Public spending, in contrast, is forecast to be constrained.
Inflation is consistent with the medium-term target, with both headline CPI and underlying measures at around 2¼ per cent on the latest reading. Labour costs remain contained and businesses are focusing on lifting efficiency. These trends should help to keep inflation low, even as the effects on prices of the earlier exchange rate appreciation wane. The Bank's assessment remains that inflation will be consistent with the target over the next one to two years.
There are a number of indications that the substantial easing of monetary policy during late 2011 and 2012 is having an expansionary effect on the economy. Further such effects can be expected to emerge over time. On the other hand, the exchange rate, which has risen recently, remains higher than might have been expected, given the observed decline in export prices. The demand for credit has also remained low thus far, as some households and firms continue to seek lower debt levels.
The Board's view is that with inflation likely to be consistent with the target, and with growth likely to be a little below trend over the coming year, an accommodative stance of monetary policy is appropriate. The inflation outlook, as assessed at present, would afford scope to ease policy further, should that be necessary to support demand. At today's meeting, the Board judged that it was prudent to leave the cash rate unchanged. The Board will continue to assess the outlook and adjust policy as needed to foster sustainable growth in demand and inflation outcomes consistent with the target over time.

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