Perth suburbs where price growth is 'turbocharged'
Perth suburbs where price growth is 'turbocharged'
Perth’s property market continues its ascent, with sales volumes and property prices sharing in the national attraction to low interest rates, high savings levels and relatively low numbers of COVID cases.
Among the top ten suburbs for price growth, median property prices rose by 25 to 45 per cent in a range of prestige and working class suburbs.
Salter Point recorded the biggest growth to its median house sale price in the last financial year, increasing 44.7 per cent to $1.352 million. This was followed by Ascot (up 42.1 per cent to $810,000), Bicton (up 30.9 per cent to $1.14 million), Claremont (up 30.8 per cent to $1.7 million) and Medina (up 30 per cent to $260,000).
REIWA President Damian Collins said the top 10 list represented a diverse mix of suburbs, with median house sale prices ranging from as low as $255,000 to as high as $1.7 million.
“It is reassuring to see that since we hit the bottom of the market in July 2020, the Perth property market recovery has been widespread," Mr Collins said.
"This is reflected in this top 10 list, with positive median sale price growth seen in suburbs from all different price spectrums of the market.
“In addition, it is also encouraging to see how dispersed these top 10 suburbs are across Perth, ranging from as far south as Wannanup, as far north as Sorrento, over to Ascot in the east and Claremont in Perth’s affluent western suburbs,” he said.
House prices in Perth are still 12.5 per cent below the last peak in June 2014 however rents, a generally reliable indicator of future price growth in this market, are now only two per cent below the May 2013 peak.
Chief Economist at Ray White Real Estate, Nerida Conisbee, said there is “still a while to run for this red hot market.”
“Unusually, the Perth market is strong at a time all other Australian markets are also strong,” Ms Conisbee said.
“It’s being turbocharged by particularly strong iron ore export growth, with iron ore sales surging by 20 per cent in May
Ms Conisbee said the suburbs doing well in Perth are a mix, ranging from affordable Medina within the industrial centre of Kwinana, to City Beach which has just hit a $2 million median.
“At a more aggregated level, it’s the Local Government Area (LGA) of Cottesloe, one of Perth’s most coveted addresses, that is seeing the strongest growth but all price points across the city are doing well, however, there is a slight tilt to some of Perth’s most expensive suburbs,” she said.
|Suburb||Median house sale price||Percentage increase in the 2020-21 financial year|
|1. Salter Point||$1.352 million||44.7%|
|3. Bicton||$1.14 million||30.9%|
|4. Claremont||$1.7 million||30.8%|
|7. Trigg||$1.45 million||28.9%|
|10. Sorrento||$1.1 million||25.3%|
Turning up the volume
In line with the rise in demand that is driving up prices, so too are sales volumes climbing vertiginously as first home buyers seek solace from rapidly escalating rents and the near non-availability of rentals in many suburbs.
Ridgewood, Madora Bay and Two Rocks are amongst the 10 Perth suburbs that have seen the biggest percentage increase in sales activity during the 2020-21 financial year.
REIWA’s Mr Collins said of the 10 suburbs to make the list, six had more than doubled their sales tally in the 2020-21 financial year compared to the previous 12-month period.
“The Perth residential sales market has experienced a rapid turnaround in the last 12 months, with sales activity across Greater Perth up 29 per cent overall, and some suburbs have far exceeded that overall figure during that same time frame,” Mr Collins said.
REIWA data shows sales volumes in Ridgewood, in Perth’s outer north, had increased by 122 per cent in the 12 months to June 2021, while in coastal lifestyle suburbs at the southern and northern extremities of the city, Madora Bay and Two Rocks, sales were up by 121 per cent and 115 per cent respectively.
“Of the 10 suburbs to make the list, seven had median house prices below the overall Perth median, while only one, Trigg, had a median house price above $1 million dollars,” Mr Collins said.
“First home buyers are very active in Western Australia, which is why the biggest surge in movement is being felt at the more affordable end of the market.
“There is good news for sellers too, with every single suburb on this list having recorded median house sale price growth over the last 12 months.
"The dominance of the more affordable suburbs on this list suggests there is particularly strong appetite from WA first home buyers who recognise that now is a great time to take advantage of Perth’s affordable housing before prices inevitably rise further as the market continues its recovery.”
|Suburb||Total sales||Percentage change compared to 2019-20 financial year||Median house sale price||Percentage change compared to 2019-20 financial year|
|2. Madora Bay||95||121%||$540,000||11.3%|
|3. Two Rocks||73||115%||$400,000||12.7%|
|6. Trigg||67||103%||$1.45 million||28.9%|
Beyond the state capital, the impact of the mining boom becomes more apparent.
Port Hedland tops the list (at an LGA level) when it comes to price growth, increasing by 45 per cent over the past 12 months.
Although very strong growth, prices are still down 40 per cent from where they were five years ago, showing the choppy nature of mining town prices.
Ray White’s Ms Conisbee said the other clear trend is the demand for beachside and treechange regional locations.
“Like the rest of Australia, changes to the way people work and demand for second homes has been a driver of demand in regional towns.”
Ray White’s newly released half-yearly State of the States review found a staggering nine of the top ten growth areas by LGA (as opposed to suburb) were in regional areas.
After the Pilbara, four of the top five were in the state’s southwest, namely Northam (growth of 38.1 per cent on a median price of $300,000, followed by Waroona (32.4 per cent/$335,000), Denmark (26.8 per cent/$520,000) and Collie (25.8 per cent/$195,000).