PERTH LAND PRICES UP TO $5000 UNDER CURRENT MARKET VALUE
The Urban Development Institute of Australia (UDIA WA) says that comments made today by national property analyst Colin Keane show that the WA property market is on the cusp of a recovery.
Mr Keane, Director of Research4, was presenting at a UDIA WA Industry Luncheon at Crown Perth to a crowd of over 350 property industry professionals about the current state of play in the Perth greenfield land market.
“The current downturn has certainly dragged out much longer than we would have anticipated a couple of years ago due to a range of factors, primarily the continuing sluggish economic conditions and slow population growth,” UDIA WA CEO Tanya Steinbeck said.
“We have also seen extremely tight lending criteria being applied by the banks which has further dampened buyer demand,” Ms Steinbeck said.
Mr Keane’s presentation provided some light at the end of the tunnel, as he outlined how the Perth land market is beginning to show small signs of improvement, however he said that underlying demand will benefit from a further lift in employment numbers.
According to Mr Keane’s analysis, WA employment growth has been lifting since mid-2017 and given there is a two-year lag between job creation and an uplift in land sales, WA is only just short of that two-year lag period and should see a positive impact soon.
“It has been a long road to recovery, however in the last few months, we have seen several positive actions that we hope will provide much needed stimulus and that will assist more buyers into the property market,” Ms Steinbeck said.
“The federal election outcome, the introduction of the First Home Buyers Deposit Scheme, the latest rate cut, along with more reasonable retail lending criteria, should all help to support a market recovery,” Ms Steinbeck said.
“As Colin said in his presentation, Perth land prices are currently representing excellent value for money, potentially $5000 under market value at this point in time,” Ms Steinbeck said.
“Given interest rates have been cut even further, combined with state government incentives such as the relaxation of Keystart eligibility criteria, those thinking about purchasing could get themselves an excellent deal,” Ms Steinbeck said.
Keystart has already seen a 50% increase in enquires in the last month since the new eligibility criteria was announced which is a good sign of things to come.
“WA’s recent upgrade to a AA1 credit rating is another positive sign for the WA economy,” Ms Steinbeck said.
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