The Real Estate Institute of Western Australia (REIWA) has recently released its March quarter data, revealing that Perth’s median house price has reached a new record of $510,000. The previous peak was recorded in the same quarter in 2010, where the median house price reached $505,000. The current median, which is 2 per cent above the median price from the December quarter, has been driven by a lift in turnover and more sales activity above the median price.
Upper end of the market gains strength
Our preliminary data for the March quarter shows that while the proportion of sales under $500,000 has fallen there was a marked increase in sales between $500,000 and $1 million.
Homes selling for $600,000 to $700,000 and those between $800,000 and $1 million represented some 20 per cent of all sales during the quarter. The $600,000 to $700,000 range was the most dominant price point above the median during this period and is a healthy illustration of consumer confidence through trade-up activity.
Despite a general downturn of sales under $500,000, those homes which sold for between $400,000 and $450,000 showed a slight increase in turnover largely driven by strong first home buyer activity.
The $400,000 to $450,000 range was the leading price point in the overall market, representing 12 per cent of all sales for the first three months of this year. Sales in this price range are turning over very quickly and the Office of State Revenue reports that in February the median purchase price for first home buyers was $425,000.
Flats, units, apartments and villas are more common in the central part of Perth and indicate a 10 per cent rise in sales during the quarter, suggesting an upturn with investor activity given that around half of all multi-residential property is tenanted. Suburbs closer to the CBD also saw stronger sales activity during the quarter including within the cities of Bayswater, Belmont, Bassendean, South Perth, Victoria Park and the coastal strip in the City of Stirling. These areas are all over the general median price and as such contributed to the overall lift in the market median.
Reassuring results across the state
REIWA’s preliminary data indicates that most local government areas had movements in median prices of plus or minus 3 per cent, suggesting that the composition of sales was an influencing factor in the quarter with more expensive homes impacting on price movements.
Nearer to the CBD in the cities of Bayswater, Bassendean, Belmont and Canning where the supply of listings has tightened all indicate a median rise of around 4 to 5 per cent.
Increased sales activity was also reported in the more traditional first home buyer areas through the southeast corridor in the cities of Gosnells and Armadale and the Shire of Serpentine-Jarrahdale, as well as Rockingham, Kwinana and Wanneroo.
Reported land sales are also showing a 10 per cent rise across the quarter. The volume of land for sale remained relatively stable across the quarter at around 1,500 lots, while the total number of listings including houses, units and land have remained reasonably steady in recent weeks. REIWA data shows listings at around 8,500 properties after starting the year at 9,300. The March quarter results show a buoyant market returning to more normal conditions on the back of solid population growth and a strong state economy.