While the overall Perth property market achieved a healthy 13 per cent increase in 2021, a number of Perth suburbs saw gains of more than 25 per cent over the same period. There are challenges facing certain sectors of the investment property market due to the impact of Covid -19. For property buyers, last year, the property market for apartments in Perth was in a good spot for local buyers, as record-low vacancy rates and low interest rates made it cheaper to buy than rent in some areas.

With Western Australia continuing to be the most affordable state to live in, interest in Perth apartments is growing and new policy recommendations from the Property Council of Australia (PCA) has highlighted ways to fight the issues currently impacting the apartment development pipeline.

Challenges in 2022 | Apartment Buildings

Unfortunately, the impact of COVID-19 on supply chains and the skilled worker shortage has now put more than 10,000 new apartments on hold, as well as $2.2 billion of pre-approval apartment projects. The potential undersupply and likely impact on pricing will be factors that potential investors should take into account of.

The demand for housing in WA and Perth is expected to grow WA looks to open its borders in February, demand is expected to continue upward as interstate Australians and international migrants look to relocate to WA. The WA government is seeking to attract east coast residents to consider relocating to WA. Changes in Government policy have prioritised population growth in WA, targeting skilled worker migration and removing investment barriers for them.

With 52,000 job vacancies in WA, despite the unemployment rate hitting its lowest point since 2012 and forecasts predicting local population growth will not meet current workforce vacancies until 2024, there is an urgency to encourage migration to fill these roles as soon as possible.

As the State Government’s $185 million Reconnect WA package works to let WA safely re-engage with the world once borders open, this is the perfect chance to use Perth’s stable economy and housing affordability as a major boon for attracting skilled workers.

There are also proposals to make permanent and expand the stamp duty concession. Establishing permanent stamp duty concession for apartments will encourage investment in the market, bringing rental prices down while spurring the demand for apartments.

The Perth Property Market Outlook

The impact of the border reopening will have a major impact on the Perth and WA property market. It is a smart move to consider investing in the Perth property market, now before the anticipated influx of new residents and investors from the East coast who have been steered clear of the local market.

According to Damian Collins, Real Estate Institute of Western Australia (REIWA) president, revealed this data and said that “2021 was a big year for the Perth property market overall and an even bigger year for the 10 best-performing suburbs”. Five of the 10 suburbs on the list had median house sale prices above $1 million, with three of them reaching the $1 million milestone in 2021, according to the REIWA report. It is expected that upward trajectory of Perth’s property market would be sustained, and there are suggestions of a double-digit price growth for the next 12 months.

Woodlands reached the $1 million price bracket for the very first time this year, whilst Wembley Downs’ median price pushed past $1 million for the first time since 2019, and North Beach’s median price pushed past for the first time since 2017. Woodlands landed on the top spot for price growth, with its median house price increasing 35 per cent to $1.23 million.

Shenton Park came in second with a price rise of 32.1 per cent, and Hillman ranked third with a price increase of 29.1 per cent.

REIWA’s top 10 suburbs for price growth in Perth for 2022

1. Woodlands $911,250 $1.23 million 35.0%
2. Shenton Park $1.27 million $1.677 million 32.1%
3. Hillman $250,000 $322,800 29.1%
4. Darlington $620,000 $800,000 29.0%
5. Wembley Downs $975,000 $1.25 million 28.2%
6. North Beach $900,000 $1.15 million 27.8%
7. Lockridge $260,000 $330,000 26.9%
8. Mullaloo $675,000 $855,000 26.7%
9. Swanbourne $1.5 million $1.875 million 25.0%
10. Brookdale $252,000 $315,000 25.0%

*Data is based on Landgate settled sales as at 12 January 2022.

Sales Results for January 2022 shows no signs of slowing down in the Perth Market. If you are thinking of buying your first home or an investment property, you need to download our Top Tax Tips Guide for Property Investors.

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Source: REIWA

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