Hi, I’m Brendan Leahy and welcome to another Naked Edge Real Estate Perth Metropolitan area market update. With spring in full swing, we’ve seen another thousand or so homes come onto the market, bringing us to just over 15,000 homes, but that’s nothing to be alarmed about because this time of year that’s to be expected as spring is the biggest selling season. I believe the market has now plateaued out and remain like this for the next six months or so. In saying that, there are still plenty of buyers looking to move to either upsize or downsize. 

With the population slowing in WA, there been a bright light pop up on the horizon with overseas migration jumping a whooping 152.6% between December 2014 and March 2015. This increase in overseas migration is great news for the states rental market as often this is the first port of call for people looking for housing, new arrivals go and rent first before they purchase. We predict this trend will continue for the state for the medium to long term as the prices in the Eastern states have risen so dramatically that WA is now the place for them to come and reside in. With the median price in Sydney topping near a million dollars, and the median price in Melbourne sitting somewhere between six and six hundred and fifty thousand, WA sitting around $500,000 is a great place for them to start. And why wouldn’t they, this lovely sunny weather that we have here.

Last month, we spoke about the impact the new APRA changes were going to have to the banks and their lending capacities, we thought it was only really going to affect investors, but it seems to be now washing right through the banking system. Deutsche Bank recently released a graph showing what the banks were lending back in April and what they are now lending in August on a $100,000 income, that being single or combined, we’ll now go over to my scribble chart just to show you a bit closer what this means.

First of all, drawing wasn’t my strong suit at school, I can tell you that. But as you can see, here at St George Bank back in April for a $100,000 in earnings were lending up to $668,000, in July that dropped down to $630,000. At the same borrowing capacity now, it sits at $585,000 and as you can see from Westpac, it’s been a similar story. $600,000 back in April, $530,000 then down to $493,000 as of August. This will now continue for a while to come in the future and it’s going to part of the norm that banks are going to start asking for basically somewhere between 20 to 30 in some cases percent deposits, so it’s just got a little bit harder for first home buyers I believe, and parents are probably going to have to give them a hand to buy homes. 

Perth Metro Statistics for September:

Sales:

Total property sales – 565 

Houses – 424

Units – 89

Blocks of land – 52

This time last year – 708

Listings:

Total listings – 15,198

Houses – 9,432

Units – 3,279

Blocks of land – 2,487

This time last year – 10,595

Top selling suburbs South of River:

Canning Vale – 13 sales

Armadale – 7 sales

Lesmurdie – 7 sales

Thornlie – 7 sales

Rental Market:

Current listings – 8,256

This time last year – 5,772

Median rental price – $410

Vacancy rate – 5.4% 

At Naked, we cover nothing up, so if you are looking to get a specific market report on what’s happening in your suburb alone, you can go to our office or contact your local Naked agent, we’d be only too happy to help.