Perth’s property boom to SLOW DOWN, says expert

It appears the “property boom” that has gripped Perth is slowing at last, as house prices “stagnate” for the third time already in 2022.

Those looking to sell their homes should not be worried, however, according to The West Australian.

RP Data research director Tim Lawless said that the halt may only be temporary – and that prices will soon start to rise again by up to five percent, with a fall later in the year.

“I think Perth will be more insulated from the sharp downturns we are seeing in Sydney and Melbourne,” he told The West.

“The fundamentals in Perth are very good, with its labour and jobs market, a strong economy, and the affordability of homes.

“Demand is coming up against really low supply levels, and this will keep a floor under the price.”

The news comes after housing sales in Perth in May reached numbers that were unheard of for over a decade, with WA’s high employment rate and factors such as fairly low interest rates contributing to the greater housing demand.

Real estate agent Greg Williams said that “low supply and stable demand means happy sellers.”

“At present, property is a much more liquid asset than it normally is, and buyers therefore need to make decisions quickly to avoid missing out.”

Real Estate Institute of WA head Damian Collins says a housing shortage in Perth will contribute to rising prices in 2022.

The West said Mr Collins had “pointed out that Perth already had a shortage of 8000 homes, which was partly responsible for the rental crisis” and that he predicted the shortage would grow to 20,000 homes in four years.

The REIWA president said that sales had increased by 15 per cent when compared to one month ago and that “growth is broadly on track”.

“We expect the monthly capital growth rate for May will be 0.5 per cent to 0.6 per cent which is solid growth and on still track to around 10 per cent for the year,” he said.

“We haven’t seen any slowdown from the interest rate rise so far. In fact we have seen the opposite, with more people making a decision to buy before rates rise further.”

Ultimately, as Mr Collins told The West, nothing is certain.

“Of course anything can happen which could change sentiment, but we have a significant shortage of properties for sale and for rent and demand remains strong which will continue to translate to price growth.”