"House prices fall after sales rush"

"A rush of first-homebuyers in the past three months has triggered a dip in Perth's median house price, figures to be released today suggest.

The Real Estate Institute of WA's monthly snapshot for last month also revealed a 9 per cent rise in rental vacancies in the past three months, prompting forecasts of lower rents.

Sales figures for the three months to the end of last month suggest first-homebuyer activity is "strongly" affecting the market, with the median house price falling 1.4 per cent to $515,000, compared with the three months to May.

"This appears to be due to the large turnover of more affordable homes skewing the median downwards," REIWA president David Airey said.

Most homes were sold in the north-west and southern parts of the City of Wanneroo, with sales increasing between 31 and 36 per cent. Sales rose 21 per cent in Bayswater and Bassendean but turnover in Joondalup fell 20 per cent.

At the end of last month, 9237 properties were listed for sale, up 5 per cent on July, according to REIWA.

However, the institute is warning of reduced land supply after the number of blocks for sale fell 18 per cent.

The overall median Perth rent was unchanged at $475 but for flats, units and apartments it increased by $5 to $460 a week. Rental vacancies are at a three-year high, 75 per cent up on the same time last year.

Mr Airey said he expected median rents to soften in the September quarter.

He said it was too early to gauge the effect of the State Government's move last month to cut the first-homebuyers grant to $3000 for existing homes.

Sally Palmer, from Homehunters Realty in Dianella, said demand in Bayswater from first-homebuyers was the strongest she had seen.

"Mt Lawley and Inglewood are becoming fairly expensive so the next step is Bayswater," she said. "It has lots of good schools, is close to the city, shops and parks and it is a family-oriented suburb.""

 

This article was sourced from The West Australian and was written by Rhianna King.

 

 

"Perth leads nation in real estate growth"

"PERTH has experienced its strongest winter residential sales season for seven years, new figures show.            
Home values across the city jumped by 3.8 per cent throughout the season up to August 26, RP Data figures show.

RP Data senior research analyst Cameron Kusher said Perth’s growth for the year to date (8.3 per cent) was currently leading the nation.

“It is important to keep in mind that winter is usually a slow period for the housing market in Perth,” Mr Kusher said.

“Of course, winter isn’t finished quite yet but if we look at the past five years it is shaping up as the strongest over that period."
Perth's fastest selling suburbs revealed

Values increased by just 0.2 per cent in winter 2012 and fluctuated in 2011 (-3.1 per cent), 2010 (0.2 per cent), 2009 (1.9 per cent), and 2008 (-1.8 per cent). 

Perth’s median house price is currently $510,000 and the median unit price is currently $425,000, according to RP Data.

“If the 3.8 per cent growth to-date holds for the remainder or winter, it will be the strongest winter for the Perth housing market since values rose by 10.0 per cent in winter 2006,” Mr Kusher said.

Finding Perth's hidden property gems"


This article was sourced from PerthNow and was written by Claire Bickers.

"Perth readers say 'no' to local government amalgamations"

"MOST residents across Perth are against the State Government's controversial council amalgamations plan.

More than 2400 people responded to a PerthNow poll on the plan to more than halve the number of councils in the metropolitan area (from 30 to 14).
The question was: Are you happy with the changes to your local council area?
The collated results show relatively narrow margins for approval of the plan in some areas.
The poll voting showed:
Yes 37.2%
No 47.9%
I don't care 14.9%
Within the "super-council'' mudmap, only four areas voted in favour of the mergers  however, these included Rockingham, Joondalup and Wanneroo which are being left intact under the plan and are consequently unaffected.
The only region in which a merger was favoured by poll respondents was Bassendean-Bayswater.

Residents across the metropolis are galvanising to voice their concerns with aspects of the merger ultimatum.
Vincent will be holding a second public meeting on Thursday at the Woodville Reserve. It believes its push to be merged entirely with the City of Perth (rather than half going to Stirling) was endorsed by Premier Colin Barnett through the week, if the City of Perth also backed the move.
A public meeting in heritage-sensitive Mount Lawley is being held at the Astor Theatre on Beaufort St on Wednesday, August 28 at 7pm.
Fremantle will hold a community rally at the Fremantle Arts Centre from 2pm on Sunday September 1. A petition is also being compiled.
The area results (in percentages):
Cambridge/Claremont/Western suburbs
Yes 37.6
No 47.0
I don't care 15.4
Stirling
Yes 33.0
No 55.9
I don't care 11.1
Armadale/Serpentine/Jarrahdale
Yes 38.3
No 46.3
I don't care 15.4
Perth
Yes 31.8
No 56.7
I don't care 11.5
Bassendean/Bayswater
Yes 46.0
No 33.0
I don't care 21.0
East Fremantle/Fremantle/Melville
Yes 39.4
No 49.4
I don't care 11.2
Canning/Gosnells
Yes 36.6
No 47.6
I don't care 15.8
Cockburn/Kwinana
Yes 37.7
No 51.3
I don't care 11.0
South Perth/Victoria Park
Yes 34.4
No 54.3
I don't care 11.3
Belmont/Kalamunda
Yes 35.8
No 47.5
I don't care 16.7
Mundaring/Swan
Yes 40.2
No 42.5
I don't care 17.3
Joondalup
Yes 40.4
No 34.2
I don't care 25.4
Wanneroo
Yes 44.6
No 28.7
I don't care 26.7
Rockingham
Yes 50.5
No 29.0
I don't care 20.5"

This article was sourced from Perth Now and was written by Mara Fox.

"Beware the mother of all housing booms"

"If we are not very careful Australia is going to have the mother of all dwelling booms. What we are seeing is a three-pronged boost to prices. First is a dramatic push to lift the demand for dwellings by banks offering cut mortgage rates thanks to Reserve Bank Governor Glenn Stevens. But second, and just as importantly, there is reluctance by banks to fund new supply.

In any commodity if you inflate demand and squeeze supply, prices go through the roof.
Thirdly taxpayers will subsidise the boom via a massive increase in the use of negative gearing via both personal and superannuation tax breaks.

Longer term, that will damage the economy and the Reserve Bank will have to take responsibility for pulling the price boom trigger. The market accepts further interest rate cuts but surely the Reserve Bank board members will now have second thoughts about future cuts.
To understand what is now happening, let’s go back to basics.

 

Where do you put your money? Glenn Stevens has priced bank deposits out of the market for long-term savers who want a fair return. Unless banks are once again prepared to go abroad for their money it means that there will be no abundance of long-term bank deposits, although there will be plenty of short-term money.

The sharemarket has delivered great returns but a large number of people have been burned in the last five years and brokers are no longer excited about value in the market. In this low interest rate environment shares will do well but that is not where the big money is going to go.

Australians are going to rush for bricks and mortar as they always have in situations like this. And when they see the market about to rise they just jump in. In Sydney, real estate agent John McGrath told a mortgage brokers' conference that the city's inner city property demand was “red hot”, although in Melbourne there is a fair amount of supply in the market. Melbourne, along with Brisbane, will quickly follow, although perhaps not with the same intensity.

Most of the demand will be from investors, including those using their self-managed funds, plus the Chinese. First home buyers will obviously contribute at the lower end.

When you see a rush of demand, what you need is supply. Given that the main demand is in inner city areas supply takes a long while to generate. Banks are reluctant to lend to developers – especially given recent failures – and the approval process is very slow.

In addition, the capacity of the building industry has been curbed by the slump and many have been forced out of business. The tax office and the banks played a big role in this.

All the conventional signals told Glenn Stevens he should lower rates. Yet if Tony Abbott wins the election we are going to see a surge in plant investment because the political crisis has held people back. The August rate cut will have had no effect. Because we are dealing with existing properties, an inner city boom does not boost employment until developers can fund and gain approval for new projects. Of course, when it spreads to outer suburban areas then it does boost employment.

At some time (not in the short term) Glenn Stevens will be forced to address the inner city property boom which he triggered in August 2013 – probably by increasing interest rates at an inappropriate time.

Negative gearing may also be curbed."

This article was sourced from Business Spectator and was written by Robert Gottliebsen.