Perth Real Estate Sales - Market Update

March 2022

Perth Real Estate Sales News & Market Insights  |  5 April 2022 

The Perth property market appears to maintain the buoyancy it's been enjoying over the past 18-24 months; however, upon closer inspection, there are two very different 'sub markets' operating simultaneously.

Established houses and other 'stand-alone' properties continue to go from strength to strength, most notably in coastal and inner-city blue-chip locations. According to REIWA, of the 3,885 properties listed for sale in the week ending 20/3/2022, there were 864 recorded property transactions - a healthy 22%.

Conversely, land sales (including house-and-land packages) haven't improved, recording just 92 transactions of the 1,644 listed for sale in the same period. Slow-moving land sales may be significantly caused by the increase in build costs that are likely a direct result of the federal and state building grants that were introduced in response to COVID.

Off-the-plan apartment sales have continued to be strong over the past 18-24 months with negative repercussions for established apartment sales. In turn, this may also be contributing to the soaring costs of building materials and labour.

The extension of stamp duty relief at a 50% discount for Off plan apartment sales for two more years suggests that this trend may continue. Both REIWA and the Urban Development Institute of WA are campaigning vigorously for stamp duty incentives to become permanent for off-the-plan apartment sales. We are concerned that all stakeholders may be overlooking the negative impact this policy position is having on the established apartment market.

With all stimulus programs there is a flow on effect to other sectors that is not always apparent at the implementation stage. Given what we have now learnt, corrective measures should be introduced sooner rather than later. We may see increased demand for established apartment sales due to the shortage of houses available for sale and rent however, this is only likely to occur if Western Australia has an influx of people from interstate and overseas now that the borders are open, and they elect to buy apartments rather than houses.

We look forward to watching this space with you and providing further updates in the coming months.

If you'd like to find out more about the Perth Property Market, contact Jonathan Marlow on 0413 833 332 or email jonathan.m@xceedre.com.au.