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Perth property nightmare continues as sales slump by a quarter

If there was any doubt the Perth residential property market was in a slump in 2010, it has been dashed by a new set of figures showing house sales plummeting in the past year.

An analysis by RP Data and reported in WA Today shows that Perth recorded 23.7 per cent fewer home sales than the previous year.Just 32,303 homes were sold in the metropolitan area, the second-worst figure since 2000. The only lower number was in 2008, when just 28,756 homes were sold following the onset of the global financial crisis.

Home sales slumped nationally, with only Perth and Sydney to record higher figures last year than in 2008.

RP Data research analyst Cameron Kusher said most of the fall was over the second half of 2010, with higher interest rates, and a lack of first-home buyers and investors major contributors.

While the company did not forecast much price growth this year, it believed sales volumes would improve.

“Housing finance commitment volumes have levelled and are now improving slightly, (national) unemployment is at 5 per cent, wages are growing at a level above inflation and limited growth in property values couples with wage growth is likely to improve housing affordability,” he said.

However, it seemed unlikely sales volumes would improve to their 10-year annual average, which in Perth was about 42,000.

Meanwhile, new figures released today by the Australian Bureau of Statistics showed the number of West Australians taking out a home loan fell 2.3 per cent in January, to 5627.

Source: WA Today



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Michael is a director of Metropole Property Strategists who help their clients grow, protect and pass on their wealth through independent, unbiased property advice and advocacy. He's once again been voted Australia's leading property investment adviser and his opinions are regularly featured in the media. Visit Metropole.com.au


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