Perth Leads Australian Property Growth as Listings and Rents Shift
According to CoreLogic, residential property values across Australia increased by 1.0% in September, with Perth maintaining its status as the top-performing capital city for the 12th consecutive month. Perth recorded a 1.6% rise in property values followed by Adelaide at 1.3%, and Brisbane at 0.9%. In contrast, Hobart and Canberra recorded the sharpest declines, with property values dropping by 0.4% and 0.3%, respectively. (CoreLogic, 2024)
Over the past quarter, dwelling prices in Perth surged by 4.7%, and on an annual basis, they have risen by 24.1% – the highest increases in the country (CoreLogic, 2024).
Listings volume increases
According to REIWA, there were 4,054 properties listed for sale during the week ending 29 September 2024. This marks a rise from the 3,637 listings recorded four weeks earlier but a decline from the 4,895 listings in the same week last year.
In September 2024, the average time to sell a house in the Perth extended to 10 days, one day longer than the previous year. Similarly, the time to sell a unit increased to 9 days during this period (REIWA, 2024).
The graph below demonstrates the downward trend of stock availability within the Perth market to the week ending 29 September 2024.
Source: REIWA and Momentum Wealth Research
Rental prices hold steady
Perth’s median rental dwelling price remained unchanged at $650 per week in September 2024; however, this represents a 12.1% increase compared to the same time last year, according to REIWA (2024). The median rental price for houses also held steady at $650 per week, while units remained at $600 per week. This recent price stabilisation may indicate the rental market has reached its affordability threshold, with many renters seeking alternatives such as shared accommodations or more affordable units to cope with rising costs.
During the week ending September 29, 2024, there were 2,088 properties listed for rent in Perth. This represents a decrease from the 2,191 listings recorded four weeks earlier but is higher than the 1,679 listings noted around the same time last year (REIWA, 2024).
The graph below shows the limited number of homes available for rent, which has pushed Perth’s vacancy rate to record lows.
Source: REIWA and Momentum Wealth Research
In September 2024, Perth’s vacancy rate increased to 1.6%, the highest level since August 2020. Despite this recent rise, rental vacancies remain far below the levels expected in a balanced market, which typically ranges between 2.5% and 3.5%. During September 2024, it took a median of 16 days to lease a property, which is 3 days faster than the previous month but 2 days slower than 12 months ago. (REIWA, 2024)
Australian housing loans surge
According to the latest data from ABS, released in August 2024, the total value of new housing loans in Australia rose by 1.0%, reaching $30.4 billion – an annual increase of 23.0% (ABS, 2024).
Owner-occupier housing finance values increased by 0.7% in August. The Northern Territory had the highest rise at 7.8%, followed by Queensland at 2.6% and South Australia at 2.1%. Western Australia recorded the lowest increase at 0.5%, while Victoria and New South Wales saw declines of 1.8% and 1.4%, respectively (ABS, 2024).
Investor housing finance values rose by 1.4%. Queensland and South Australia led with increases of 7.9% and 5.1%. The Australian Capital Territory saw a modest rise of 0.4%, while New South Wales remained unchanged. Other states and territories experienced declines, with Tasmania down 9.1%, Western Australia by 8.3%, Northern Territory by 8.1%, and Victoria by 2.7%. (ABS, 2024)
In Western Australia, the percentage of investor finance fell slightly to 38.3% in August. However, this figure has more than doubled since the 2019 market low, as investors are attracted to the region’s growing market and high rental yields.
The below chart reflects the annualised change in new loan commitments within the Western Australian market.
Source: ABS