WA home owners are moving less frequently

by Administrator 8. April 2015 23:54

New analysis from the Real Estate Institute of Western Australia indicates that Western Australians are moving house less frequently than they used to.

A comparison of figures between the periods of 1990-91 and 2013-14, showed that as dwelling stock across the state increased from 586,000 to 992,000, the average turnover time increased from 14 to 21 years.

REIWA President David Airey said this suggested that owners and investors are holding onto property for longer, which debunks the long held myth that home owners move an average of every seven years.

“The peak turnover rate of 11 years occurred in 2005-2006, at the height of the property boom and record turnover.

“Conversely, the longest turnover period of 25 years occurred in 2010-2011 as markets across WA recorded weak turnover levels not seen since the recession in the early 1990s,” Mr Airey said.

Further analysis at sub-region and region level produced varying results across the state, with the Perth metro area's turnover climbing from 14 to 19 years, which was not as significant as the overall state figure.

“If we break this down to the types of dwellings, we find that owners of multi-residential property, such as units, apartments, villas and townhouses, have traditionally held property for longer and continue to do so.

“This is probably influenced by the fact that around half of all multi-residential stock is owned by investors. Around 22 per cent of Perth’s dwelling stock is multi-residential and our research shows ownership of this stock has stretched from 16 to 23 years since 1990,” Mr Airey said.

Perth metro 

At sub-region level within the Perth metro area, results were much more varied.

In the central sub-region (roughly a 10 kilometre radius from the CBD), data showed that this zone held 59 per cent of all dwelling stock in the 1990s, but had dropped back to 47 per cent, while the average turnover moved slightly from 15 to 19 years.

Higher turnover rates were found through the northeast region of Perth, which includes Swan, Mundaring and Kalamunda. In this region, the ownership period stretched from 14 to 21 years, which is the longest rate in the Perth metro area.

Perth’s southeast sub-region saw more rapid turnover through Gosnells, Armadale and Serpentine-Jarrahdale.

“This is probably indicative of the larger number of first home buyers and investors, and possibly also the higher number of forced sales resulting from the recession in the early 1990s.

“These factors may also have influenced the northwest sub-region through Joondalup and Wanneroo, where the holding time went from a low of 13 years to 19 years during the period of this study,” Mr Airey said.

Perth’s southwest region, through Cockburn, Kwinana and Rockingham, saw turnover rates shift from 14 to 18 years.

Regional WA

In Regional WA, turnover times were more highly variable as a result of changing economic fortunes, population growth, investment trends and lifestyle choices which ebb and flow around the state.

“In the Peel region, including Mandurah, the high level of turnover once associated with discretionary holiday homes has given way to levels now comparable to Perth as its population has grown.

“It looks similar through the South West and Great Southern, with an upward trend in turnover time more reflective of lifestyle living choices, while in the Wheatbelt, the holding time has stretched out to 42 years as rural communities decline,” Mr Airey said.

Through the mid-west, the mix of rural and holiday settlements beyond Geraldton has influenced more recent turnover rates, while in the Gascoyne, lower sales activity after the Global Financial Crisis in 2008 blew out the turnover rate.

The Pilbara saw little change between 1990-91 and 2013-14, and there was an extended period between 1995 and 2010 where average turnover periods levelled at 20 years.

In the Kimberley, low turnover in sparsely populated and small communities resulted in turnover rates similar to those found in the Wheatbelt.

Source: aussiehome.com

Perth Oversupplied with Sales and Rentals

by Administrator 26. March 2015 21:29

New reiwa.com data shows that the number of properties on the Perth market has reached 14,000, while the number of homes for rent has surpassed 6,500.

President of the Real Estate Institute of Western Australia, David Airey, said listings had jumped for both sales and rentals as a result of WA's slowing population growth rate and the effect of new building construction impacting on established home sales.

“The number of properties listed for sale has jumped by over 2,000 since the start of the year and sales have slowed by 15 per cent when compared to the same period last year.

“With 6,500 rental properties available across the metropolitan area, that’s a 210 per cent increase since 2012 and has pushed the vacancy rate over four per cent,” Mr Airey said.

Mr Airey said the very high level of house and unit construction across the state, accompanied with the fall in population growth, had tipped the scales to oversupply.

“Added to this is the big fall in the number of first home buyers choosing established homes and building new ones instead.

“However, this is great news for buyers and tenants because it means there is a huge amount of choice and very competitive pricing.

“Along with record low interest rates, there has rarely been such a good time to buy and first home buyers continue to be active in the market place,” Mr Airey said.

According to reiwa.com data, Perth’s median house price dipped by $5,000 last month to around $547,000, while metropolitan rents were holding steady at $440 per week.

“With this large supply of homes for sale and rent, it’s likely we will see negligible price growth across 2015 and a fairly slow market for those selling property or looking for tenants.

“It is essential that sellers and owners listen closely to the advice of their selling agents and property managers to ensure the right marketing and pricing in what will prove to be a very competitive environment,” Mr Airey said.

Mr Airey said that recent figures indicated that the average number of days on the market for home sales had stretched to 67, compared to the more usual 45, while the number of sellers prepared to discount their asking price was now 57 per cent.

Rental leasing times across Perth is averaging 36 days.

Source: reiwa.com