Demand for WA property set to remain strong

There is no doubt that residential housing markets are booming in Western Australia, sparked by the State and Federal Government building stimulus measures introduced last year, in conjunction with record-low interest rates, the rental supply shortage and many people returning to WA from interstate and overseas during the pandemic.

While some believe the current boom may only be a short-term bubble ready to burst now that stimulus measures have come to an end, the latest market statistics and economic indicators paint a very different picture.

Firstly, UDIA WA’s March quarter new land sales figures show that despite the winding up of government stimulus measures for new builds, new land sales increased close to five per cent over the quarter. Even more significantly, sales in the March quarter were more than 31 per cent higher than the same time last year.

Importantly construction levels were also up, with developers lifting projected activity for the year ahead by close to 50 per cent compared with the same time last year. This figure reflects the general confidence in the development industry that buyer demand is likely to remain higher than pre-pandemic levels for at least the next 12 months.

Looking at the apartment market, figures from the Urbis Apartment Market Essentials reflect strong sales activity in the March 2021 quarter. In fact, the 405 apartment sales recorded in the March quarter is the second highest level of sales recorded since March 2016.

In the established market, REIWA is predicting that property prices will grow by 15 per cent this year. This expectation was revised upward off the back of strong market activity in the first quarter of 2021.

These strong sales numbers across the three markets and positive expectations from within industry for the next 12 months are supplemented by expectations that in the longer term, Perth and WA’s population will likely grow as borders reopen.

If WA can leverage the reputation it has built around safety, strong economic growth and stable employment, then we can expect many people from overseas to consider a move down under to the most isolated state in the world.

There is also the expectation that investor activity will continue to lift given the current rental shortage and the consideration of Perth and WA as a relative safe haven with affordable investment opportunities.

Overall, there is a positive outlook for the WA residential property market in the next 12 months and beyond.