Perth’s record-breaking house prices are tipped to jump 5 to 7 per cent next year, making it one of Australia’s strongest performing capital city property markets.
According to a report released yesterday by Australian Property Monitors, Perth, Sydney and Brisbane have the best prospects for growth in median house prices.
The report predicts buyer activity will start slowly in Perth next year but will pick up “sooner rather than later”, thanks to a strengthening local economy.
The report comes after the Real Estate Institute of WA revealed this week that Perth’s median house price had hit a record $535,000.
APM said the Perth market recorded a solid year this year, with the median price expected to end 5 per cent higher than the price peak in June 2010.
APM senior economist Andrew Wilson said although the market flattened after a strong start to the year, the outlook for next year was positive. “There is a lot more confidence around in the Perth housing market now than there has been for a couple of years,” he said.
The report said record-low interest rates, improved affordability and rising confidence had led to a recovery in the national housing market over the past year.
Next year, the national median price was expected to rise between 3 and 5 per cent.
Urban Development Institute Association WA chief executive Debra Goostrey said she expected the Perth market would remain strong over the next two years.
“Even conservative statistics say Perth is about 32,000 dwellings short, so while interest rates are low and confidence is fairly solid, we will see the house and land market continue to grow,” she said.
“One of the core things for us is that it does not accelerate too quickly because that is when things get out of control.”
REIWA’s snapshot for the three months to November showed the market had rebounded from a September quarter slump.
A REIWA spokesman said the institute would analyse all its December quarter data before making calls on the outlook for next year.