Prices to rise further when border falls
Western Australia’s border reopening will set the stage for another year of solid growth in house prices in 2022.
The Real Estate Institute of WA (REIWA) predicts house prices will jump 10 per cent this year as the state finally lowers the drawbridge to interstate and overseas migrants on February 5.
REIWA president Damian Collins said increased demand from new arrivals and low stock levels would place upward pressure on prices, particularly in the second half of the year.
“WA has always been a state that has been driven by jobs and a strong economy and that’s what drives the population growth,” he said.
“I expect once the borders come down, companies are certainly going to start ramping up their recruitment drives, both on the east coast and internationally.
“Now it will take some time to get those people recruited and on board, but I expect in the second half of 2022, we will certainly start to see a pick-up in population growth into Western Australia.”
WA most affordable state in the country
Despite the strong price growth in 2021, Mr Collins said WA is still the most affordable state in the nation, with prices remaining 3.4 per cent, or roughly $18,000, below their 2014 peak.
Perth’s median house value of $520,000 is the second-lowest in the country, behind $498,168 in Darwin.
As of June 2021, Perth’s median dwelling value was tracking six times higher than household incomes, compared with the capital city average of eight.
Mr Collins said the relative affordability of WA, coupled with a tightening labour market, would support further price growth.
Outer suburbs to see price gains in 2022
Mr Collins said price growth in 2021 was driven by the “top end” of Perth’s real estate market, in the western suburbs and in riverside locations.
“I think we’re going to certainly see more of a bottom-up approach this year, with growth in those suburbs that were oversupplied for a long time, where prices went down significantly,” he said.
While REIWA does not provide price predictions for individual suburbs, he said this would apply to outer suburban areas where houses are priced in the $350,000 to $400,000 bracket.
Sourced from: ABC News