Perth boasts ‘dual opportunity’ for property investors
Currently the fastest-growing major market across Australia, Perth is emerging as a unique opportunity for investors as forecasters tip strong price growth to continue in 2021, potentially outstripping other capital cities.
CoreLogic’s January Home Value Index recorded a 1.6 per cent monthly increase in prices across Perth, and a 3.8 increase compared with three months prior, making it the fastest-growing major market in the country, Momentum Wealth noted.
The rise in prices comes on the back of increasing demand for properties in the state, with buyer’s agents reporting a marked influx in enquiry.
According to Momentum Wealth Buyer’s Agency team leader Emma Everett, enquiries received in the final quarter of 2020 soared 164 per cent compared with the same period a year earlier.
The growth comes as a result of rising interest from investors, as well as an increasing number of buyers looking to relocate to Perth as a reaction to the pandemic.
“For investors who have benefited from recent upswings in their own market, there’s certainly a great opportunity to leverage WA’s affordability and enter the Perth market to take advantage of its respective growth cycle.
“I think many investors are now recognising this could be a time-limited opportunity,” Ms Everett commented.
Looking ahead, experts believe that Perth could outperform the national price growth, with price rises tipped to hit 12 per cent.
Apart from sustained growth in property prices, investors also stand to benefit from tightening conditions on the Perth rental market, where yields are continuously growing.
In fact, buyer’s agents have reported seeing “houses with strong underlying land value that are also achieving yields of 4.8 per cent to 5.5 per cent or even greater in some cases for properties with a dual income strategy”, according to Ms Everett.
“WA is currently one of the most affordable states to buy across Australia, which, combined with a significant tightening of rental stock and initial rent increases, has had a positive impact on rental yields.”
But those looking to invest in Perth in 2021 are advised to do their due diligence, particularly in regards to area and property selection, as these remain critical in maximising the benefits of the market upswing.
After all, not all areas will be performing equally, Ms Everett said, particularly in a recovering market such as Perth.
“Our advice to investors is to buy selectively, and if you aren’t familiar with the local market, engage someone who can offer that local expertise to guide you in making the right investment decision,” Ms Everett concluded.
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