In areas throughout Australia, the property market has begun to warm up as vendors seem more willing to test the market through listing their properties, according to CoreLogic data.
Across the capital cities, new listings increased by 0.7% in the four weeks to 20 September, propelled forward by a jump in Sydney and – somewhat unexpectedly – Perth, which has distinguished itself as “a market primed for recovery” as seen by Eliza Owen, CoreLogic head of research Australia.
“For the four weeks ending 20 September, Perth and regional WA were the only dwelling markets where new listings volumes exceeded the numbers in the equivalent four week period of the previous year,” Owen said.
“[But] listings is not the only transaction data suggesting more confidence in the Perth dwelling market,” she added.
Perth is also the only capital city where sales numbers in August were actually above the pre-COVID average.
“These higher levels of transaction activity are also showing up in mild value increases across the Perth dwelling market,” said Owen.
Over the first three weeks of September alone, the Perth home value index increased by 0.6%.
“While a positive turn in Perth dwellings may be surprising during a recession, the WA economy has been supported by a 4.8% increase in mining investment over the year. ABS payroll data suggests since the start of the pandemic, payroll jobs across WA fell less than 1%, compared with national declines of 4.5%m,” Owen explained.
“Perth dwelling values are also relatively affordable, sitting 22.2% below the record dwelling value in June 2014, and there is a strong mix of state and federal first home buyer incentives in place, which may be encouraging demand as well.”
However, for the upswing of property values in Perth to be sustained, the market must remain resilient through the end of mortgage repayment deferrals; it will further depend on if additional reductions are made to the cash rate, as well as how successfully COVID-19 is contained.