Perth – Is this the bottom of the market?

 House prices have risen in Perth for the first time in almost two years, in a sign experts say shows the market may have finally bottomed out.

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According to official figures released by the Australian Bureau of Statistics, Perth’s residential property prices jumped half a per cent in the December quarter.

The increase brings an end to the ongoing trend of sliding property prices recorded since late 2013.

Despite the jump over the last quarter, Perth recorded an overall annual drop of 2.9 per cent in property prices.

Perth and Darwin were the only two capital cities to record an annual fall in property prices, according to the ABS residential property price index.

Domain senior economist Dr Andrew Wilson said the ABS figures reflect what looks to be the bottoming out of the Perth housing market following two years of steady decline.

“Confidence is gradually returning to the market,” Dr Wilson said.

“I think that is because affordability is activating buyers. We’re seeing mid to high price range buyers become more active in the market.”

Dr Wilson said the “lowest interest rates in living memory” were also part of the driving force behind the recovery in Perth’s housing market.

However he also said Perth’s unemployment rate remained high at 6.3 per cent and the future of the market would largely depend on the local economy, which has been marred by the end of the resources boom.

The subdued levels of confidence in the housing market were partly heralded by the end of the fly-in fly-out workforce, which has seen a steep drop in demand across the state.

The median price of houses bought and sold in Perth over the December quarter was $535,000 according to the ABS figures, a jump from $530,000 in the September quarter.

The data also states the median price paid for a Perth apartment was $435,000 in the December quarter, an increase of $2000 on the previous quarter.

Hayden Groves, president of the Real Estate Institute of Western Australia, said the composition of the market had changed in December, with a slightly higher proportion of properties in the $750,000 bracket selling.

Mr Groves said it was too early to confirm whether the latest figures were part of a wider trend in Western Australia.

“I’m really waiting for the March quarter numbers and what happens with the median prices will be quite telling,” he said.

“I’ve predicted before that I think we will see a rise in the median house price in 2016 [but] I think it will be very mild.”

Mr Groves said he expects an increase in trade-up activity will push up the median house price over the coming months.

 

 

 

 

thanks domain and REIWA.