John Percudani, Managing Director of WA-owned real estate agency, Realmark said, “our outlook is that the WA market has not reached its summit in this property cycle, and we can expect moderate growth and activity to continue for several quarters.
“Whilst West Australians are restoring equity and wealth through property, values still remain around sixteen per cent below Perth’s price peak in 2014. The Real Estate Institute of Western Australia is forecasting these levels are likely to be met by 2022,” he said.
National commentators predict real estate activity across the country will begin to taper in the second part of 2021. While Realmark suggests Western Australia presents a more ‘longstanding’ improvement to market conditions compared to its interstate counterparts.
“WA is improving from a much lower base to other Australian States after seven years of significant recalibration.
“In 2020, we experienced the most dramatic increase to net migration of all States – with insufficient housing supply to meet new arrivals.
“Compared to other Australian markets, the affordability ratio here is still much more enticing at around thirty per cent, rather than forty-plus per cent on the East coast. This is not only appealing to first home buyers and upgraders, it’s an enticing environment for investors - who have started to show their interest in participation.
“Listing stock is sitting significantly below the five-year average at around twenty-six per cent, while stock is being absorbed at twice the normal rate. It will take much time for supply to catch up to demand pressures and inflict a price plateau – although speed and activity may moderate during this time,” said John.
While it’s expected many areas in WA will experience growth in 2021, improving values will not be homogeneous across the State. Property in above-median-price suburbs are likely to experience the most substantial growth, and earlier than Perth’s outskirt suburbs. Although, Realmark has a considered and positive outlook to the broader Perth and WA market, including the South West and other key regional markets.