Perth land sales fall by nearly half over the past year
Good news for established property owners in the Perth market.
Blogger: Shane Kempton, CEO, Professionals Real Estate Group
The residential building boom in Perth over the past four years had significantly increased the supply of the housing stock at a time of slowing population growth.
These two factors have combined to put a downward pressure on Perth established house prices.
However, REIWA figures show that new land sales are slowing with 1,684 lot sales during the September 2015 quarter compared to 3,131 for the September 2014 quarter - a fall of nearly half.
This has been part of a downward trend after lots sales peaked at 4,299 during the Mach 2013 quarter.
Property values are based on supply and demand and the reality is that the recent building boom has greatly increased the supply of homes.
It will take some time for the slowdown in new building to impact on the established property market but we should see a positive impact towards the end of 2016 when the market should become more balanced between buyers and sellers.
The slowdown in land sales has seen developers now offering attractive incentives to entice property buyers in many areas of Perth. However, anyone considering buying a lot needs to focus on fundamentals as this will determine the long term financial benefits of build a new home.
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