What is really going on in the market? When is the best time to buy? Should you wait a little longer? The burning questions every Perth buyer has can easily be answered.
Before we delve into those questions, we sat back and thought about the market and real estate and what it really all means. In Australia, most properties are seen purely as investments. Sure, we want our homes to suit our needs but money and return on investment always seems to be the driving factor in determining where “home” will really be. When we think of a home, we think of a private place to express ourselves, we think of a sacred space, a place to make memories with our families and a place where we can truly be ourselves. Irrespective of the market, it is important to differentiate between a home and a property.
Now, let’s get on to the market! Due to the decline in housing values over the past five years, Perth properties are now more affordable whether you’re a first home buyer, a growing family or a downsizer which means this is an excellent time to buy. A mistake many buyers are at risk of making is choosing to hold off a little longer to see if prices further decline as there are absolutely no indications that this is going to be the case. If anything, a steady rise is predicted and no one wants to get their proverbial foot into the door of their new home when prices are on the up.
The latest Buy-Rent Index compiled by Curtin University and the Real Estate Institute of WA is further evidence of this.
The Buy-Rent index attempts to measure when it is more financially advantageous to buy rather than rent.
REIWA president Damian Collins said the index showed median house prices in Perth would only need to rise 2.9 per cent annually over the next 10 years for house purchases to be considered more financially viable than renting.
“This bodes very well for Perth buyers, considering the 15-year annual average house price growth rate is 5.1 per cent,” Mr Collins said.
Getting back to the upsizers and downsizers, there is a valid strategy which should certainly be considered. Buy now and secure your dream home or location with the aim of renting the property out for a few years and then move in when you’re ready. It’s a great way to get what you want whilst pocketing some extra cash.
When it comes to the main driving force behind the reviving market, growing families are leading the way due to the affordability in popular suburbs which are seen as upgrades or dream final destinations. The stigma around subject sales is certainly one which needs to be broken. If you are in a position where upgrading means you would have to sell your current home and you’re letting the fear of your potential sale price hold you back, it’s important to assess the saving and investment potential of your desired new home and analyse the benefits versus losses.
With the differential between the low, middle and high areas of the market decreasing, now is the time.
Statistics sourced from thewest.com.au