Negativity in key Australian markets reduces optimism for Perth's future, but many positive signs emerge for the city
Despite early reports of strong optimism, consumer expectations of Perth have declined. Results from the latest ANZ / Property Council survey index of June 2019 revealed that Perth's confidence level had fallen 129 points to 125 in the previous quarter.
"Last year's optimism about green shoots did not fully materialize. While WA is a separate real estate market from the eastern states, media coverage and negative sentiment in Sydney and Melbourne may have influenced Perth residents, "said Sandra Brewer, executive director of the Property Council. of Western Australia.
However, there are still good reasons to believe in Perth's prospects.
"Confidence in the real estate industry in Washington State has been mildly shocked, but is still in positive territory and third in the country," Brewer notes.
"It was promising to see an increase in headcount over the last four consecutive quarters, demonstrating that the industry is expecting an overall increase in activity. The industry of Western Australia remains convinced that strong economic growth can come back; this is reflected in the fact that WA had the highest expectations for the economic growth of states in all jurisdictions. "
For this reason, construction activity within the local industrial sector is gaining increasing confidence as METRONET and Infrastructure WA projects gain ground.
The first activity of a home buyer is shot in the arm
Resources are making a comeback to support the local economy. Coupled with the now affordable properties generated by the downturn, the activity of first home buyers has increased significantly as coastal land becomes available at low prices. Many projects are in the works, including the $ 1.7 billion Eliwana iron ore mine of FMG and the $ 28 billion spent on the development of Browse LNG by Woodside.
"This new investment in the resource sector has led to increased employment in the mining sector over the last two fiscal years, and improved employment opportunities have led to an increase in the number of young FIFO families buying houses and land. Jarrod Rendell, project director for Atlantis Beach Estate in Two Rocks.
"This is part of the general trend of growth in the activity of first-time homebuyers in WA, first-time home buyers now accounting for 34% of overall financing commitments for homeowners of the state. It is the highest rate of all Australian states. "
SUBURB TO MONITOR
MIDLAND: The bottom is nowhere in sight
Property values ​​continue to decline in the suburbs of Midland, considered the regional center of the city of Swan, about 16 km from Perth's central business district.
House prices were reduced to US $ 364,129, after negative growth in the 12-month period ending March 2019, which again reached the 10% rate of -10.4% . This continues the downward trend observed over the past five years. Things are not more optimistic in the unit market, where the median value was less than $ 250,000, after a 27% fall over three years, until March 2019.
However, investors can benefit from a high average rental yield, which is 5% higher for both houses and units, starting in January 2019.
Location: Midland is the regional center of the city of Swan and is also close to Perth
Yield: Rental yields are high: 5.4% on average for houses and 5.8% for units
Top suburbs:
Millner
,
Menai
,
Eagle Valley
,
Gladesville
,
emerald
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