The property market in Western Australia, particularly in Perth, is set for a dynamic year in 2024. Here’s an in-depth look at what to expect based on current trends and expert predictions.
1. **Continued Price Growth**
The property market in Perth has been experiencing robust growth, and this trend is expected to continue into 2024. House prices are forecasted to grow by approximately 8-10% over the year. This growth is driven by several factors, including strong demand, limited supply, and potential interest rate cuts later in the year
2. **Supply and Demand Imbalance**
The number of homes available for sale in Perth has significantly decreased, with listings dropping from over 7,000 in early 2023 to below 5,000 by late 2023. A balanced market typically has around 13,500 listings, indicating a severe supply shortage. This tight supply, coupled with high demand, is likely to keep pressure on prices, making it a seller's market
3. **Rental Market Tightness**
The rental market in Perth is experiencing near-record low vacancy rates, with listings for rental properties significantly below the balanced market level of around 6,000. This shortage is driving up rental prices, which surged by nearly 20% in 2023. The rental market is expected to remain tight in 2024, with continued high demand and limited supply pushing rents even higher
4. **Economic and Population Growth**
Western Australia’s economy remains robust, supported by strong demand in the resource sector and ongoing infrastructure projects. The state's population growth rate is the highest in Australia, driven by an influx of skilled workers attracted by job opportunities and relatively affordable housing compared to other major cities. This demographic trend is expected to sustain demand for housing in 2024
5. **Challenges in the Construction Sector**
The construction sector in WA has faced significant challenges, with dwelling approvals and completions remaining low. Over the past three years, the number of new homes added annually has been insufficient to meet the increase in households, exacerbating the supply-demand imbalance. This ongoing issue is likely to continue influencing the market in 2024, contributing to the upward pressure on property prices
6. **Regional Market Outlook**
Regional areas in WA, particularly those linked to the resource sector, are expected to see strong growth. Areas like Bunbury, Geraldton, and Mandurah are highlighted for their affordability, infrastructure, and proximity to major mining sites. These regions are likely to experience significant demand, driving both house and rental prices higher
7. **Investor Sentiment and Economic Factors**
Despite the positive outlook, there are headwinds to consider. Rising living costs, inflation, and recent interest rate hikes could impact consumer sentiment and borrowing capacities. Some homeowners might face challenges in servicing their loans, potentially leading to more properties being listed for sale. However, the overall market sentiment remains optimistic, with experts anticipating continued growth and strong performance in Perth and regional areas
## Conclusion
The Western Australian property market is poised for another year of growth in 2024, driven by strong demand, limited supply, and a robust economy. Both buyers and investors should be prepared for a competitive market environment, with significant opportunities in both metropolitan and regional areas. Staying informed about market trends and economic factors will be crucial for making strategic decisions in the coming year.
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