PERTH HAS CHANGED DRAMATICALLY SINCE THE TURN OF THE CENTURY AND ONE OF THE MOST NOTICEABLE CHANGES IS THE PERTH SKYLINE.
Apartments in Perth were the fastest growing dwelling type over the last decade, growing three times faster than detached houses.
According to the latest Census figures, the number of occupied private apartments increased 66 per cent over the ten years to 2011, more than the increase in flats/units (up 42.1 per cent), townhouses (up 12.4 per cent) and detached houses (up 22.1 per cent).
| Suburb | Apartments |
|---|---|
| East Perth | 57% |
| Burswood | 49.2% |
| West Perth | 47.5% |
| Perth City | 46.2% |
| Northbridge | 32.4% |
| North Coogee | 25.0% |
| Crawley | 24.4% |
| Cockburn Central | 18.2% |
| South Perth | 18.1% |
| Jolimont | 17.5% |
Table 1 – Apartments as percentage of dwelling stock (source: UDIA, ABS Census 2011)
Last year the UDIA Intelligence Unit analysed five years of apartment sales in Perth and revealed a number of significant trends.
Apartment sizes are smaller
A combination of changes to planning regulations, building innovations and consumer needs has driven a rapid decline in apartment sizes. The median size of apartments built between 2006 and 2011 was 85m2, a 35 per cent decline on apartments built in the 1980s.
The rise of studio and one bedroom apartments has been the strongest driver of the fall in median apartment sizes. Twenty eight per cent of new apartment sales were studio and one-bedroom one-bathroom apartments; compared to 16.5 per cent for existing apartments.
Two bedroom apartments still make up about half of both new and existing apartment sales, however, new two bedroom apartments are more likely to have two bathrooms – 88 per cent of new apartments were 2-2 compared to 58 per cent of existing apartments.
| No. of bedrooms/bathrooms | Median price | Median size (m2) |
|---|---|---|
| 1 bed, 1 bath | $399,000 | 59 |
| 2 bed, 1 bath | $470,000 | 75 |
| 2 bed, 2 bath | $565,000 | 85 |
| 3 bed, 2 bath | $740,000 | 122 |
| 4 bed, 2 bath | $1,100,000 | 184 |
Table 2 – New apartment characteristics, Perth (source: UDIA, Landgate)
Price of new apartments vis-à-vis existing
New apartments are not limited to the premium purchaser. Over the study period, 40 per cent of new apartments sold for less than $500,000, whilst 15 per cent of new apartments sold for more than $1m.
Besides an aberration in 2008, new apartments are priced quite competitively compared to older apartments. Over the last five years, on average, new apartments sold for a five per cent premium over the price of existing apartments.
New apartment sales more cyclical than existing
The Institute’s analysis revealed that new apartment sales vary significantly more than sales of existing apartments.
The fall in sales of new apartments and relative strength of existing apartments meant that the proportion of new apartments has eased significantly, falling from nearly three quarters of all apartment sales in 2007 to around 50 per cent in 2011.
Despite the noticeable changes to the Perth skyline, apartment living is far from widespread in Perth. With apartments making up only 1.3 per cent of occupied housing stock the city has a long way to go before reaching the likes of Sydney where 7.6 per cent of the housing stock is apartments.
New apartments = less than two years old and ‘off the plan’ purchases