The numbers are good but there is caution in the air
Perth's property prices are trending upwards but home buyers are showing some signs of reluctance in current climate.
A little of the urgency seems to have gone out of the Perth real estate market, with agents suggesting Donald Trimp’s war on Iran could be partly to blame.
The Real Estate Institute of WA said Perth property performed strongly in the first quarter of the year.
The median house price rose 4.1 per cent to $890,000 and units were up 5.8 per cent to $635,000, with new listings rising through March into April.
“It is good to see Perth’s listings logjam ease,” said REIWA President Suzanne Brown.
“But I will note that new listings are still below long-term averages, so this is not a significant increase in supply.”
Brown said the other change in market dynamics was an easing of buyer urgency.
“Our members are reporting less activity at home opens, fewer offers and more negotiation,” she said.
“In part this is due to the increase in listings, which has given buyers more choice and time to make decisions. However, it’s also due to buyer sentiment. Understandably, buyers are becoming more price sensitive.
“They are being impacted by interest rate increases, which reduce their borrowing power, and are concerned about more rate rises this year.
“They are also concerned about the rising cost of living and uncertainty caused by the conflict in the Middle East. In these situations, people tend to delay significant decisions if they can.”
Brown also said the Middle East conflict appears to be contributing to rising building costs and slower completion times.
“As we saw during COVID, this could maintain buyer focus on the established homes market,” she added.
“We won’t see the full impact of these factors for some time.
“Based on current conditions, we are keeping with our original forecast of 10 per cent median sale price growth for houses and 15-20 per cent growth for units.
“We will continue to watch the market and update our forecast accordingly.”
