Land sales lead Perth property revival

PERTH property sales are at the highest level in five years, led by the soaring demand for land.

June reiwa.com. data showed sales increased 55.1 per cent on May and were 45 per cent higher than June 2019.

Reiwa president Damian Collins said it was clear the recent HomeBuilder and Building Bonus grants had boosted transactions.

Of the 3990 sales recorded by reiwa.com in June, 2519 were for dwellings, a 15 per cent increase over the month, and 1471 were for land, up a massive 289 per cent from the 378 recorded in May.

The top suburbs to see an increase in transactions were Willetton, Thornlie, Girrawheen, Dudley Park and High Wycombe.

When it came to land, Baldivis recorded the highest amount of sales followed by Wellard, Piara Waters, Brabham and Hammond Park.

“The large spike we have seen in land transactions can be attributed to people fearing that they may miss out on these grants,” Mr Collins said.

“There is a real possibility that we will run out of titled and completed blocks in the coming months.”

The increased activity saw the median price for land increase 5 per cent over the year to $250,000 while the median house price was unchanged at $475,000.

Mr Collins said the market was starting to favour sellers.

“With listings for sale down 9 per cent to only 10,310 and sales activity increasing, it is fast becoming a sellers’ market,” he said.

“While monthly changes in prices can be volatile, rising sales and dropping stock levels are usually a precursor to rising prices.

“During the initial COVID-19 period there was some downside price risk to Perth property prices, however it now appears that Perth prices will generally hold firm and could even possibly rise; this is of course dependent on the economy opening up and remaining open.”

The Perth rental market continued to tighten in June, with listings falling a further 15 per cent to 3963.

“This reduction in listings means we can expect the vacancy rate to drop further from the current 2.2 per cent,” Mr Collins said.

“In saying that, there are many agents on the ground who are reporting the vacancy rate for their agency sitting as low as 1 per cent.”

The suburbs that saw the largest increase in leasing activity were Cloverdale, Rockingham, Mt Lawley, Beckenham and Subiaco.

Perth’s overall median rent price remained at $350 per week.

“While the ban on increasing rents is in place for established tenancies during the COVID-19 emergency period, agents are reporting some evidence of rising rents on newly leased property,” Mr Collins said.

“Once we emerge from the emergency period, we may see median rental prices rise.”