Published on January 17th, 2013
WA real estate market cautious, agent says
Despite it being the new year, the real estate market is very much maintaining the status quo in Western Australia as cautious optimism among buyers continues.
That's the assessment from Elders Real Estate rural operations manager Phil Melville, who said that some aspects of the market are doing alright.
He commented: "Well priced properties are still getting interest and we're probably seeing some increase in the amount of property transactions.
"It's (Western Australia) a safe place to invest and the quality rentals are attracting investors as a result of a low vacancy rate and high demand."
The preference for investors is to achieve capital growth, so generally a newer, cheap home on a block of land is quite attractive, Phil said.
The Elders agent added that the appeal of the marketplace is related to gains from rents given that growth in the value of property isn't likely to occur for a while.
The real estate market is subdued because people aren't willing to pay premiums for homes that they possibly once would.
It has to stack up financially on the rental income and there's less emphasis on capital appreciation, he commented.
Phil mentioned: "I don't believe that the interest rates are aiding the sector much at all, they rise and fall. I'm not seeing it – I'm seeing turnover as a result of sound economic assessment and I don't think it's a huge stimulus, it does help but it has been overemphasised."
The market itself and shrewd pricing of a good property is what will really attract buyers, more so than interest rates, Phil explained.
For first home buyers, he said that he thinks there is some merit in government grants but a short term stimulus won't have long term benefits.