Perth set for a growth year in 2012
A number of experts are tipping that the Perth real estate market is set for its first growth year since 2007, which is great news for owner-occupiers.
“The mining sector continues to drive business confidence and already we have seen this translating into stronger office and industrial markets,” said Angus Raine, CEO, Raine & Horne. “It’s fair to expect that the residential market in Perth will also benefit from the rebounding resources sector and the jobs this creates.”
In North Perth, Larry Gallagher, Principal of Raine & Horne North Perth, says there is a degree of optimism that wasn’t present in 2011, while news that WA’s population is booming is also to underpin real estate values. “New figures released by the state government in the middle of February revealed that three million people will live in Western Australia by 2026, nearly half a million more than predicted back in 2006,” says Mr Gallagher. “People are coming here in droves and are renting at a fast and furious pace.”
As a consequence, the bulging population is adding to the squeeze on Perth’s tight tenancy market and means renting is almost more expensive than buying.
“High rents will force the hand of first home buyers,” said Mr Gallagher. “This will create a ripple effect with upgraders selling to first timers and then moving onto bigger homes. So, 2012 could prove a good year to sell a North Perth home if you’re considering a move.”
Entry level homes in North Perth, according to Mr Gallagher, are available for under $300,000. “This will secure an older two-bedroom apartment that requires a bit of refurbishing,” he added.
South of the CBD and leading financial magazine Money Magazine has nominated Rockingham, as its leading ‘standout location’ in Australia. For what it’s worth, Rockingham forced Muswellbrook (NSW) into second place. According to Money, “[Rockingham] remains one of the most affordable areas in Perth despite having one of the strongest capital growth rates over the past 10 years. This is a seaside municipality with good road and rail links to both the Perth CBD to the north and the lifestyle precincts such as Mandurah to the south.”
Paul Curran, Principal of Raine & Horne Rockingham & Suburbs and Raine & Horne Rockingham Beach, was thrilled by Money’s rating of his municipality, and said there will be more first home buyers in the coastal market in 2012. “There is still plenty of value in Rockingham and it’s possible to buy three bedroom homes for between $240,000 and $290,000,” said Mr Curran. “We recently sold a nice-sized three bedroom home in Montego Close, Safety Bay for $295,000.”
Overall, Mr Curran estimates there is about 30% more first home buyers in the market than in February 2011. “Around 20% of our buyers are first timers,” he added.