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Perth Housing Market Update [Video] – September 2016

The CoreLogic Hedonic Home Value Index recorded a 1.1% rise across the combined capital cities over the month of August, while the performance of the combined regional areas (based on a one month lag) remained comparatively soft, with dwelling values virtually flat at -0.1% over the month.

Perth remains as one of the only capital cities to record a fall in dwelling values over the most recent twelve month period, declining by 4.2% in both cities.

Softer economic conditions and a significant fall in overseas migration rates, together with an increasing net outflow of residents to other states and territories, has made a substantial dent in housing demand.   Perth city skyline at night

This has resulted in corresponding declines in both dwelling values and rental rates.

The August Home Value Index shows a substantial difference between the performance of house and unit values.

At a combined capital’s level, house values rose by 7.2% over the past twelve months, compared with a 5.5% rise in unit values.

Looking at housing market performance across the broader value segments over the past 12 months, the most affordable suburbs have recorded the greatest value rises, while the most expensive suburbs have seen a more moderate rate of growth.

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In the weakest markets of Perth and Darwin, transaction numbers have been trending lower since 2013, as housing demand has progressively softened, with the number of dwelling sales also trending lower in cities where values are rising.

The trend of fewer sales coinciding with values pushing higher is likely explained, at least partially, by low stock levels, particularly in Sydney and Melbourne, where listing numbers remain close to record lows.

Other factors that are likely to be contributing to the slowdown in transaction numbers include tighter lending conditions, decreasing levels of affordability which prevent some segments of the market from participating and high transactional costs including stamp duty on purchase.

You May also be interest in reading:

Brisbane Housing Market Update [Video] – September 2016



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About

Tim heads up the Core Logic RP Data research and analytics team, analysing real estate markets, demographics and economic trends across Australia. Visit www.corelogic.com.au


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