2022 in review: Perth
Western Australia’s capital remained incredibly resistant to market downturns throughout the year while maintaining relative rental affordability in the face of declining vacancy rates.
Housing values concluded 2021 at levels akin to 2007 in Perth, according to CoreLogic data and began the new year by growing 1.9 per cent during the first quarter, buoyed by 1 per cent growth in March, according to the research body’s Home Value Index (HVI). This led to the city’s median dwelling price sitting at $542,338.
April brought with it the first Reserve Bank of Australia (RBA) cash rate increase of the year as inflation hit 5.1 per cent, lifting it from the record low of 0.1 to 0.35 per cent. One month later, the pace of Perth’s dwelling value increases would slow to 0.6 per cent as part of what PropTrack described as the swiftest rate of decline in 33 years.
The new financial year brought comparisons between Australia’s market downturn and 2008’s global financial crisis, and while the rest of the nation became entrenched in the market’s decline, Perth was one of three capital cities to resist the trend as prices grew 0.2 per cent to $560,020, those the pace of growth had begun to slow.
Perth’s prices began to go backwards in August as part of the swiftest rate of value decline in 40 years.
Median unit values in Perth, which were $409,747 in April, having grown 0.3 per cent the previous month, ended November at $410,046, having declined 0.8 per cent across the preceding quarter.
On the rental front, the West Australian capital, much like the rest of the nation, spent much of the year in the grips of a crisis. CoreLogic’s Quarterly Rental Review for the third quarter of the year revealed nationwide vacancy rates hit record lows during the three months to September, resulting in a vacancy rate of 0.6 per cent.
CoreLogic also found Perth to be Australia’s third-most affordable capital city for tenants, with median weekly rents in the city at approximately $533, having grown 2.5 per cent during the preceding quarter.
A primary factor driving Perth vacancy rates from the 1.1 per cent they were 12 months ago to current levels, and consequently forcing rents the other way, has been stalled housing supply.
A PropTrack report published at the beginning of November found housing supply Australia-wide to be at its lowest point in nearly two decades, with the number of properties listed for rent declining 20.5 per cent in the past 12 months.
Much remains to be seen around the future of house and unit prices in Sydney as the year draws out and 2023 begins; however, much will be dependent on the RBA’s cash rate trajectory.
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