Thousands stripped off house values

as posted on TheWest

The median house price in Perth has slipped $13,000 as the glut of homes for sale spreads from the mortgage belt to the western suburbs and inner city.

New Real Estate Institute of WA figures show 17,584 homes and blocks of land are listed for sale, up from about 5000 just five months ago and the highest number of homes on the market in 12 years.

President Rob Druitt said the 2.7 per cent fall in the median house price for the March quarter from $470,000 at the end of last year to $457,000 was caused by the combination of interest rate rises, a drop in overall consumer sentiment and the record number of listings.

Listings are up an average of 31 per cent for the quarter across the metropolitan area and Mr Druitt said the message to sellers was to cut their asking prices in order to sell.

“The top end of the market has now cooled for the first time, whereas in 2007 it had performed very strongly and was probably holding up the median house price quite well,” he said.

“Now that it has hit a plateau we’re finding the figures are skewed a little because there are a lot more sales at the bottom end of the market.”

First-homebuyers were resilient in the market despite interest rate increases due to strength in the economy and wages growth and because some price reductions had made buying more affordable, he said.

Rental increases had also made buying attractive, resulting in a median rent increase for houses of just 1.5 per cent last quarter to $335 per week. Median unit rent increased 3.3 per cent to $310 a week and the overall vacancy rate had dropped to just one per cent.

Mr Druitt said there were 2400 lots of vacant land on the market which meant some areas were overstocked, helping bring prices down. He said buyers should take advantage of the temporary market dip.

Listings in the Wanneroo coastal corridor and Stirling areas are up 32 per cent and listings in the Hills and Swan corridors are up 22 and 31 per cent. In the south-west there are 30 per cent more homes and blocks listed in Cockburn and 26 per cent more in Rockingham and Kwinana.

The south-east corridor, including Gosnells, Armadale and Serpentine, is up 25 to 30 per cent. Canning is up 23 per cent.

DANIEL HATCH

as posted on TheWest