Perth properties selling at record pace
Residential property values rose 0.8% across Australia during September 2023, with Adelaide (1.7%), Perth (1.3%) and Brisbane (1.3%) recording the strongest monthly rises. Dwelling values in Perth rose by 3.6% over the past quarter and 8.8% over the past year – the strongest annual rise in the nation. (CoreLogic, 2023).
The strong demand for properties in Perth continued, with a median time of just 9 days to sell during September 2023, which is the fastest time on record since 1998 when data was first collated (REIWA, 2023).
Housing supply reaches 30-year low
Property listings reached record-low levels, decreasing to just 4,895 properties available for sale in Perth during the week ending 1 October 2023, which is the lowest level in 30 years. The number of listings declined from 5,131 recorded four weeks prior and 8,116 in the same week 12 months prior. (REIWA, 2023).
The graph below demonstrates the downward trend of stock availability within the Perth market.
Source: REIWA and Momentum Wealth Research
Rental vacancy rate declines
According to REIWA, in the week ending 1 October 2023, there were 1,679 properties available for rent in Perth, which is slightly higher than the 1,655 recorded four weeks prior. The median rental dwelling price remained unchanged at $580 per week.
The rental vacancy rate contracted to 0.7% and is far below what is expected for a balanced market, which is typically between 2.5% and 3.5%.
During September 2023, it took a median of 14 days to lease a property, which is one day faster than in August and two days faster than three months ago. (REIWA, 2023)
Perth’s population growth strains housing supply
The net supply of dwellings is used to identify how housing supply and demand influence residential dwelling prices within the Perth market. It is found by deducting the estimated quarterly demand for dwellings by the number of dwellings added onto the market, less demolitions.
In the March 2023 quarterly population data, WA recorded the nation’s strongest annual growth at 2.8%. This increase of 26,005 people is the largest growth on record since data was first collated in December 1982.
During the March quarter, 4,134 dwellings were completed, while 330 dwellings were approved for demolition. After allowing for the demand from population growth, and the supply from completions less demolitions, this left WA with a net housing supply deficit of 6,598 dwellings (based on ABS data indicating, on average, each household within WA is occupied by approximately 2.5 people).