PERTH Property Market 2021 [November UPDATED]
Published 1:14 am 23 Nov 2021
Home to more than two million people, Perth is the sunniest city in the world, enjoying more sunlight year-round than anywhere else. In this article, you’ll find all of the latest Perth property market news.
Table Of Content
- Perth Property Market News [November 2021]
- Perth Property Market Growth & History
- Perth Property Market Forecast 2022
- Most Expensive Suburbs in Perth
- Cheapest Suburbs in Perth
- Perth’s Apartment Market
- Perth Rental Market
- Property Investment Advice For Perth
- Can you still buy properties at a discount?
Over the past year, Australia’s property market values have increased at rates not seen since 1989, and Perth has been no exception.
Ranked the 7th most liveable city in the world in 2016, Perth has served as the birthplace of icons like Sam Worthington, Isla Fisher and the late Heath Ledger. On top of this, Perth is home to 19 beaches and the largest inner-city park in the world.
Over the past fifty years, Perth has seen a population growth of roughly 300%, and house prices have increased by 260%.
That’s why we’ve decided to take a deep dive into the Perth property market, to discuss its history, the current trends, and where it’s headed.
Perth Property Market News [November 2021]
Throughout the pandemic, Western Australia famously took an isolationist approach, closing its borders off entirely to the rest of the country. This allowed the state to avoid the sustained lockdowns recently witnessed by capital cities like Sydney and Melbourne, saving WA billions of taxpayer dollars.
However, WA’s vaccination rates are the lowest in the country at a 60.2% double-vaccinated rate compared to the national average of 74.1%. As the rest of the country opens up, WA officials have yet to outline how they will proceed forward.
Having said all of this, over the past year, house prices in Perth have gone up by 18.1 per cent – a pace that is below the national average of 20.3%. And, like most capital city property markets, This rate of growth is beginning to slow. CoreLogic data shows that Perth property prices lifted by just 0.3 per cent in the September quarter.
Perths’s Dwelling Values as of October 2021. Source: CoreLogic’s Hedonic Home Index
While the median national house price now sits at $674,848, Perth’s median house price remains below that average at $548,589 according to CoreLogic.
And, as of the 24th of October, Perth’s preliminary auction clearance rates sat at 42.9%, while every other capital city had a rate above 80%.
Perth Property Market Growth & History
Perth occupies the opposite end of the price spectrum to Sydney, as the most affordable capital city in terms of housing in Australia.
Compared with Sydney’s stunning median house price of $1,499,126, you could buy nearly 3 houses in Perth at Perth’s median home price of $548,589.
Perth’s property market hit an all-time high in 2014 of $545,000, which the WA-bound capital city has narrowly surpassed.
During the September quarter, Perth was the only capital in the country to record a price fall over the quarter for both houses and units according to the latest Domain House Price Report.
Speaking on this decline, Domain chief of research and economics Nicola Powell said that “Prior to this decline, Perth had seven straight quarters of consecutive growth.”
“None of the other cities have had that – they’ve all had fluctuating quarters. So I think that says a lot in terms of how relatively un-impacted the housing activity market has been in Perth due to the pandemic.”
The median price of a house in Perth is currently 6.2 times the average income, up from roughly 4 times the average income since the ‘70s.
Comparatively, Sydney properties cost 12.2 times the average income.
Perth Property Market Forecast 2022
During the coronavirus pandemic, a combination of effective fiscal policies, increased savings and the inability to travel all combined to drive up the Australian property market.
In fact, the market climbed at its fastest rate since 1989, rising 20.3% over the year.
As we mentioned at the outset of this piece, Perth has been the beneficiary of this growth, albeit to a lesser degree than the national average, rising 18.1% over the same period.
And, as we mentioned, Perth’s property prices – both houses and units – have dropped in value over the September quarter, suggesting that the days of double-digit growth are over for the WA capital.
“The quarterly decline was only marginal but it could signal buyers are becoming constrained by affordability and the fear of overpaying created by the heated buying conditions. Perth still remains a sellers’ market, as total supply remains tight and close to a multi-year low but it is starting to lift,” said Dr. Powell.
Interestingly, however, the average salary of Perth is $98,420, with a median house price of $524,589. Contrast this with New South Wales, where the average salary is $93,236, and the median house price is $872,934. From this perspective, affordability should be of much less concern in Perth than it is in Sydney.
Moreover, as Perth has had closed borders throughout most of the pandemic, the opening of WA’s borders will likely see a population increase that may help drive up property values and rent prices throughout 2022.
Most Expensive Suburbs in Perth
Despite being the most affordable capital city in Australia, there are plenty of million-dollar suburbs in the Perth property market.
In fact, there are now 20 Perth suburbs with a median house price of $1 million or more, with four suburbs being added to the million-dollar club after their median house price grew to seven figures in this past year.
Here are the top 10 most expensive suburbs to buy the median house in Perth:
- Dalkeith – $2.9 million
- Peppermint Grove – $2.897 million
- Cottesloe – 2.625 million
- City Beach – $2.2 million
- Nedlands – $1.91 million
- Claremont – $1.85 million
- Swanbourne – $1.735 million
- Floreat – $1.63 million
- Mosman Park – $1.61 million
- Applecross – $1.6 million
Speaking on the growing number of suburbs in Perth that have median house prices above $1 million, Domain chief of research and economics Nicola Powell said that more suburbs will be joining the list soon:
“I think, with the continued strength and the continued consistent upswing, there are likely to be more that will hit that million dollar mark,” she said.
“We are expecting the new record [median house price] high to be achieved in Perth early next year if we continue to see prices grow at the rate they were.”
“This is a premium price for Perth. It is lower than the median price for Sydney but I think it’s really reflective of that active buyer [and] the fact that upsize buyers haven’t been as impacted economically by COVID,” she said.
“We’ve got higher levels of household savings and people have been able to take a chunk out of their super through that early access program. We have seen incentives and the ultimate low home loan rates … if you are going to have debt now is the time, really, because credit is so cheap.”
Cheapest Suburbs in Perth
While the number of million-dollar suburbs in Perth is growing, the fact that Perth is the most affordable capital city tells you that there are still plenty of bargains to be found.
When speaking on the affordability of Perth, REIWA’s President, Damian Collins, said:
“Perth is the most affordable capital city of all the states around the country.”
“It is pretty incredible you can get a house at $300,000, even if you have a mortgage for almost the entire amount – it’s certainly a lot cheaper than renting in most of these suburbs.”
So, without further ado, the top 10 cheapest suburbs (in terms of median sale price) to buy a house in Perth:
- Armadale – $260,000
- Medina – $260,000
- Camillo – $270,000
- Orelia – $275,000
- Parmelia – $280,000
- Lockridge – $286,500
- Greenfields – $290,000
- Leda – $290,000
- Mandurah – $290,000
- Brookdale – $295,000
Speaking on some of the affordable suburbs within Perth, Mr. Collins said:
“Seeing as though the median house price in Armadale is $260,000, if you get a home loan you would probably end up paying around $100 a week in interest repayments, which is very affordable,” he said. “As far as the suburb goes, it has a train line and a good town centre with plenty of employment opportunities. It’s a very affordable location within close proximity to the hills.”
Perth’s Apartment Market
Across most of Australia, there is a widening gap in prices between houses and units. In Sydney, for example, the median house is a whopping 59 percent more expensive than the median unit.
The median unit in Perth is valued at $398,502, which is roughly 27.5 percent less expensive than the median house price of $548,351. Evidently, the gap between unit and house prices in Perth is much smaller than in places such as the ACT and Sydney.
And, in many suburbs within Perth, units are outpacing house prices. REIWA data found that 19 suburbs in Perth saw unit prices grow faster than house prices in the year to September 2021.
However, there are still regions where house prices far outstrip unit prices, such as Mosman Park, where the median house price of $1.6 million is nearly four times more than the median unit price of roughly $400,000.
And it should be noted that 68 per cent of all properties sold in Perth were houses, while 17 per cent were units, and the rest was vacant land. The number of houses greatly outstrips the number of units in Perth.
Perth Rental Market
Much like the rest of the Perth property market, Perth’s rental market is relatively affordable when contrasted against places like Sydney.
The median Perth house rent is $450 a week according to Domain, and the median unit rent per week is $380.
While the pandemic wrought damage upon the rental markets of places like Melbourne and Sydney, who suffered from long lockdowns and an exodus of residents, places like Darwin and Perth enjoyed strong gains in rental rates over this same period according to CoreLogic’s Quarterly Rental Review.
Over the twelve months to July this year, Perth’s house rental rates rose by 17%, and units by 14.7%, the second largest annual jump after Darwin’s 23.6% and 19.2% respectively.
However, this rate of rental growth looks like it will begin to slow, says Domain chief of research and economics Nicola Powell:
“I think what the story really is for Perth is these steady asking rents are a real shift from the rapid rent growth that we had seen because there had been four consecutive quarters of strong rates of growth in asking rents.”
“So, I think what it suggests is that maybe the peak rate of rent growth has passed because we have seen such a significant change in a very short rate of time.”
Property Investment Advice For Perth
Investing in Perth is no different from investing elsewhere in Australia. As such, many seek out off-market property opportunities in Perth in the hopes that they can find a property below market value.
However, regardless of where you invest, you’ll want to look at the underlying fundamentals of the market and assess what is best for your situation.
For starters, ensuring that you have a solid understanding of the latest Perth property market news will help you to navigate the ever-changing property landscape.
For example, do you intend to purchase an investment property in Perth with the intention of flipping it? Or do you wish to lease out your property in order to generate an income stream and tax benefits?
If you intend to lease out a property, particularly in Perth, then you’ll want to bear in mind that the recent growth in rental rates in Perth may be unlikely to continue, according to some experts.
However, WA’s borders are about to open, which presents new opportunities for Perth’s rental market.
These are all things you’ll want to consider if you are thinking about getting an investment property in Perth as all of these factors can make or break your profit margins.
You can read our full article on how to find great property deals in this booming property market to learn about the rest of the indicators that will guide you toward high-growth suburbs. Though if you’d like to find off-market property in Sydney, you may wish to attend one of our Real Estate Rescue courses.
However, with the RBA maintaining that interest rates will be kept at record lows until 2024, it looks like all lights are green for property investors in Perth.
Can you still buy properties at a discount?
Australian house prices haven’t been this hot for decades. And, as we’ve just mentioned, they’re going to continue heating up.
“Great! So how am I supposed to find a deal in today’s market?”, I hear you say.
Well, let us show you what some of our graduates have achieved.
Some have found properties at 10% below market value, while others have bought properties at 40% below market value.
And you can too.
Learn how our students are finding these amazing property deals (even in a bull market!) at our upcoming Real Estate Rescue Masterclass.
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