While investment in the Melbourne and Sydney property markets cools, economic advisers have started looking out west to Perth as one of the country’s best buyer markets.
Right now, Perth has a whopping 19,000 properties listed on the market and investors have seen a drop of $20,000 of the median house price in the June quarter to $525,000.
Conversely, here in Melbourne the median house price has seen a jump of $60,000 to $671,000 in the past 12 months.
With Sydney’s housing bubble expected to burst somewhat, Damian Collins from Momentum Wealth told News.com investors would get better value in WA.
“While the temptation is to follow the herd, it’s much better to buy when the market is in a low of its cycle,” Mr Collins said.
“Long term, the prognosis for WA isn’t bad, and while population has slowed, we still have the fastest-growing population rate in the country. We’re simply in a low point of our cycle.”
Hegney Property Group director Gavin Hegney also spoke to News.com and agreed.
“There tends to be a cycle of emotions that follow with the property market,” Mr Hegney said.
“Sydney has been at the euphoria stage, but this is actually the stage of maximum financial risk and will turn into the anxiety stage.”
“I think in Perth we’re in the fear stage and this will continue until the market starts to upturn and we reach the hopeful stage. But, as an investor, there is less reason to be fearful in Perth than there is in Sydney.”
Karen Firth from Bourkes told News.com she had seen increased investment activity from interstate with buyers picking up properties for a fraction of the price of their home State in Victoria or new South Wales.
“In South Perth you can get a home for around $1 million — in Sydney you wouldn’t even get an apartment for that much,” Ms Firth said.
Interestingly, Mark Hay Realty director Mark Hay said he expected to see an increasing number of retirees move from Sydney to Perth to take advantage of gains in Sydney by selling their properties, buying in Perth and pocketing the leftover for their retirement.
REIWA deputy president Hayden Groves told News.com he expects perth to have a median house price of $1 million in the next 15-20 years.
“This could accelerate if the demand for resources from China and India returns to peak conditions, once again triggering an economic upturn throughout WA and putting upward pressure on property prices,” Mr Groves said.