Death of the gap year could fuel first buyer demand in WA

DECEMBER 24, 2020

The Perth market turned the corner in 2020, and even COVID-19 failed to stymie this momentum, said Andrew Brien, CEO, Raine & Horne. 

“The Perth market is booming like everywhere else, and properties are selling above expectations,” Mr Brien said.

“The continuing return to form by the mining industry, which began in 2018 is central to this bounce.” 

The mining industry is expected to attract around 1,000 workers to Western Australia a month in 2021, and this will be a major factor in market activity, according to Mr Brien.

“The mining companies are now more receptive to workers to live in Western Australia rather than fly in and fly out as they did during the last boom. 

“These people will need somewhere to live, and this demand will underpin rental and sales markets in Perth and regional cities such as Bunbury. 

“That said, any sanctions by China on iron ore from Western Australia will have a major impact on this outlook.”

Mr Brien believes that Perth market activity in 2021 will also be determined by the number of properties that are listed for sale at the end of January. 

“Our Perth offices are light on for listings right now, so we might need to wait until after the Australia Day holiday to see whether this situation changes.”

The Raine & Horne CEO believes that the closure of international borders will encourage more younger Australians to start their real estate journey earlier.

“COVID has forced many younger Australians to either cancel or postpone the traditional post-university gap year, which means that they are starting in the workforce earlier. 

“With interest rates at all-time lows and plenty of government money available for first-time buyers in Western Australia, the temporary brakes on overseas gap years could also underpin real estate activity in 2021.”