PROPERTY REPORT JUNE 2015
Contents State of the Property Market 1 Market Statistics March Quarter 2015 2/3 Bespoke Finance Update 3 Help! We’ve got ants! 4
STATE OF THE PROPERTY MARKET BY ALAN BOURKE When the going gets tough, the tough get going The housing market in the Eastern states is booming, but looking at WA’s numbers, it appears to be a bit of a bad news show. Perth’s median prices are down from $550,000 to $535,000, stock levels are increasing (14,329 homes for sale at the time of writing, compared to 10,179 same time last year). Yet less sales are happening, which of course affects the number of days the average house sits on the market. Depressing? Perhaps, but every coin has a flip side. Great buys can be found in this market and while you may not receive your dream figure for the property you’re selling, your cheeky offer on the next one might just be accepted. When times are tougher, it’s important you strategise effectively with your agent. Your marketing budget will likely increase due to the time your property sits on the market. Property presentation, such as home staging, is vital to push some homes in front of their competition. Auction is becoming a popular method of sale for those wanting to sell quickly rather than obtaining the premium price. REIWA statistics show auction properties are selling on average in 26 days – considerably quicker than the private treaty homes that average 68 days on the market. It’s not all bad news While falling iron ore prices and its negative economic impact affect buyer confidence, an important reason for the real estate slow-down is the lower overseas migration to Perth. Compared to last year, approximately 20,000 less people made the move to WA. So while Perth’s population still grew 2.2%, it was down 1% on the previous twelve months. This slowed demand for housing and, as a result, pushed stock levels up. But it’s not all bad news. The real estate market has, and always will, fluctuate from a market favouring sellers to one favouring buyers. And with the latest Reserve Bank rate cut decreasing interest rates to a historic low, we may well see some interesting action in the market in the next couple of months. A market such as ours demands an experienced agent with innovative ideas. If you’re thinking of selling, talk to the experts at Bourkes on 9474 2000 to find out how we can help you succeed.
REIWA Quarterly Statistics - MARCH QTR 2015 Quarterly sales in South Perth, Como, Kensington, Manning and Salter Point
100
80
22%
24%
80
70
60 56% Percentages
50%
50
40
$0-$500k $500k-$1M
30
$1M-$1.5M
20 17%
$1.5M-$2M
20%
10
$2M+ 2% 3%
4%
Quarter-Year
Dec-14
Mar-15
* Total Sales
235
210
0
2%
Perth Metro - Quarterly Sales 9000
100%
8000
Down by 20%
80%
7000 6000
60%
5000 4000
40%
3000 2000
20%
1000
0% Mar -15
Dec -14
Sep -14
Jun -14
Mar -14
Dec -13
Mar -13
Jun -13
Sep -13
0
Perth Metro - Total amount of listings for sale 16000
80 14000
14000 12000
55
57
10000
8261
8000
50
49
50
8797
8693
8664
10068
57
59
10872
10372
68
12033
58
60 50 40
6000
30
4000
20
2000
10
0 Mar -15
Dec -14
Sep -14
Jun -14
Mar -14
Dec -13
Sep -13
Jun -13
0
Mar -13
2
70
AVERAGE NUMBER OF DAYS LISTED
Perth/WA: Regional Snapshot
March Qtr 2015 Preliminary
Dec Qtr 2014 Revised
Median House Price, Perth
$535,000
$550,000
Median Unit/Apartment Price, Perth
$440,000
$445,000
Number of First Home Buyers, WA
21%
24%
Number of Trade-up Buyers, WA
64%
66%
Number of Investors, WA
15%
10%
Number of House Sales, WA
9,400
9,200
Number of Unit/Apartment Sales, WA
1,900
1,800
68 days
58 days
14,329
12,033
Vacancy Rate, Perth
4.4%
4.2%
Median Weekly Rent
$430
$440
Official Cash Interest Rate
2.25%
2.50%
Standard Variable Bank Home Loan Rate
5.65%
5.95%
Average Selling Days (Residential), Perth Properties For Sale (End of Qtr), Perth
BESPOKE FINANCE UPDATE At its May meeting, the Reserve Bank of Australia (RBA) decided to cut rates for the second time this year, bringing the official cash rate to a new record low of just 2.00 per cent. The move has excited a flurry of activity from lenders, as they start to drop home loan interest rates again for the second time this year. The question is: can interest rates drop even further? Market analysts are speculating that even more rate cuts may be on the horizon. The RBA’s most recent move to lower interest rates is an effort to stimulate economic and employment growth, and lower the Australian dollar to support our export markets. If global factors continue to put upward pressure on the Australian dollar, and business confidence continues to flag, there is speculation that RBA may move to cut rates again later this year, bringing the cash rate below 2.00 per cent.
For finance advice call Chris Hazell from Bespoke Finance Group on 0403 527 440 or email chris@befg.com.au
Whilst the latest rate reduction was a positive for homeowners, the WA first home owner market took a hit when the WA 2015-16 state budget was delivered on the 14th of May 2015. The WA Government has announced that the first home owner grant of $3,000 will be removed for the purchase of established homes in WA and whilst this doesn’t affect the $10,000 new home sale grant, it is unwelcome news for those looking to enter the property market for the first time. The announced first home owner grant change will not take effect until amending legislation is passed by the Parliament, which is expected to occur during the latter half of 2015. The grant will remain in place for eligible applicants purchasing established homes with contracts signed before the legislation is passed. If you are a first home buyer and have been looking to get into the WA market, now could be the perfect time to make the move with record low rates and the WA $3,000 grant available for a limited time.
3
PROPERTY MANAGEMENT TIPS
Help! We’ve got ants! Easy (and pet-friendly!) tips and tricks to get rid of ants As the weather turns cooler, all sorts of unwelcome guests of the six-legged variety turn up on your doorstep. Ants especially are annoying, as it takes time and effort to eliminate them from your home. While most hardware stores sell various types of poison to get rid of ants, when you have pets or small kids, toxic remedies are not always a viable option. But fear not! We have researched and found some simple and effective methods to deal with ants in your home, without harming your kids or pets.
Bourkes’ 5 Top Tips 1. First things first: not all ants were created alike! Some ants love sugar, others prefer protein. Figuring out what type of ants you have running in your pantry will go a long way in getting rid of them. Put some honey or jam in a small shallow dish near the ant trail – if the ants go for it you know you’re dealing with sweet tooths! 2. When ants go on foraging trips, they leave a scent trail for their compatriots to follow. An effective way to disorient and banish ants is to mix one part water with one part vinegar. Spray and wipe this on any area you see ants, it’ll remove their scent trail and send them packing! 3. The most effective way to get rid of ants is to destroy the nest. Do your ants like sugar? Mix 1 part of baking soda with 1 part of powdered sugar in a shallow tray and put it near the spot where the ants enter your home. The ants will collect bits of the mixture and take it back to the nest. When they eat the baking soda, it will kill them, eradicating the colony over time. Note that this might take a few days, but keep at it! 4. If you see an ant, don’t step on it! Instead, follow it to wherever it is going because it is probably a scout sent to forage for food. Follow it back to the nest, and once you’ve found that, pour undiluted vinegar over it to scare away the colony. You may have to repeat this a few times, but eventually the ants will get fed up and leave. 5. Find the entry point where the ants are coming into your home. Take a piece of chalk and draw a thick line around the entry point. The ants will not walk over the chalk!
Nothing is working? That means it’s time to call in the professionals! Talk to your Bourkes property manager for the best contacts.
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