UPDATE: Perth housing prices are skyrocketing, increasing at an alarming rate of $5,000 per week, according to new data from Cotality’s latest home value index released on October 30, 2023. This surge represents a staggering 2.4 percent growth last month, adding over $21,000 to the median dwelling price, which now stands at $914,229.
This dramatic increase marks Perth as the city with the highest growth in property values across Australia, far outpacing Sydney (up 0.5 percent), Melbourne (up 0.3 percent), and Brisbane (up 1.9 percent). Research director Tim Lawless emphasized the extraordinary nature of this monthly growth, noting, “In fact, the last three months we’ve seen Perth values rising more than 2 percent month-by-month, much more than any other capital city.”
The implications of this rapid growth are significant. “This means the market is rising in value by about $5,000 a week, which is impacting affordability more severely than it has in the past,” Lawless warned. He pointed out that home values in Perth have surged by an astonishing 87 percent over the past five years, in stark contrast to a mere 15 percent increase in incomes during the same period.
As a result, those without home ownership are facing increasingly challenging conditions. “If you don’t have a stake in the ground, accessing housing is going to become a lot harder,” Lawless stated. The rental market is also feeling the pressure, with rents rising sharply, putting lower-income individuals in a precarious situation.
The current price surge is largely attributed to “extraordinarily low supply levels,” with listings in Perth down 44 percent from the average for this time of year, and 28 percent lower than last year. Lawless noted that the number of new listings has consistently been below average, which is exacerbating the situation. “Even though there are strong selling conditions, the speed of the market seems to be disincentivizing many from selling their homes,” he explained.
Looking ahead, Lawless indicates that the market may soon see signs of cooling, potentially starting in the New Year. He cites factors including affordability issues, rising inflation, and the Australian Prudential Regulation Authority (APRA) closely monitoring credit flows. “APRA has already tightened lending conditions, and there’s a risk of further restrictions, particularly for investors,” Lawless warned.
As the housing crisis unfolds, residents and potential buyers in Perth are left grappling with the immediate impacts of this unprecedented growth. The urgency for solutions is palpable, as many fear they may be priced out of the market altogether.
Stay tuned for more updates as this developing story unfolds.
