Perth property selling quickly as prices languish

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Oct 17, 2016

Perth property selling quickly as prices languish

Buyers are snapping up Perth properties as affordability improves, says Vivien Yap of LJ Hooker Claremont.

Supplied.

Vivien Yap, director LJ Hooker Claremont, says says good properties are selling quickly as prices remain weak in the Perth property market.
Supplied.

Yap recently sold this property at 56 View Street, Peppermint Grove.

With Perth property prices languishing, buyers are moving quickly to purchase, according to Vivien Yap, director of LJ Hooker Claremont.

"We're finding people are purchasing much faster," she said, explaining that a property she listed on a Saturday, received an offer on the Monday which eventually led to a sale after only one showing. Last month, Yap sold two properties within a week.

Recent data from the Real Estate Institute of Western Australia confirms the trend, with average listing days falling from the June 2015 peak of 71 days to 64 days in June 2016.

Yap said Perth's affordability relative to Sydney and Melbourne, and its proximity to Asia, also worked in its favour. "It's a lot cheaper than Sydney and Melbourne," she said.

Perth's median property price fell 7.0% in the year to 30 September, according to the CoreLogic RP Data Daily Home Value Index, and is now sitting at $565,650. Prices fell 2.5% in the month of September alone.

By comparison, the median property price in Sydney is $1.31 million, and in Melbourne is $843,230.

Yap said that, of course, sales depend on the desirability of the property, "but if it ticks all the boxes" she said, properties are selling quickly. Yap said she sold $48 million worth of property in the period 1 July to 18 September.

The Housing Industry Association's Affordability Report for the September 2016 quarter, shows overall affordability improved in Australia. Around the nation, affordability improved by 0.1 per cent, but in Perth affordability jumped 7.5 per cent as prices in the city fell.

“Over the past year, housing affordability has been helped by the two reductions in interest rates from the RBA,” said HIA's senior economist, Shane Garrett.

Yap said some of the demand was coming from offshore, particularly from China. "We're finding there are a lot more enquiries," said Yap.

Apart from lower prices, developer incentives are also attracting buyers, said Yap. Some developers are offering discounts of up to 5%, apartment upgrades, or selling apartments with furniture.

Some investors who bought when prices were higher are using the lower prices to average out the value of their portfolios, said Yap.