First home buyer activity in Perth drove a strong overall result in the March quarter, although numbers may have peaked.
According to RE/MAX WA managing director Geoff Baldwin, the market has been running hot, with a high number of first home buyers.
“The sub-$600,000 segment of the WA market has been strengthening for some time, fired up by latent first home buyer demand, and this activity is now beginning to feed through to the higher prices as people upgrade to second and third homes,” he said.
However, new figures released by the Real Estate Institute of Western Australia (REIWA) suggest first home buyer number may be on the decline.
David Airey, president of REIWA, said that overall it had been a good quarter for buyers and sellers, with most indicators continuing to point to long-term stabilisation.
“REIWA agents are certainly reporting strong crowds at home-opens and multiple offers on well-priced properties," he said.
“First home buyer activity, however, appears to have peaked and has fallen to an estimated 26 per cent of established dwelling sales. It looks like their enthusiastic rush into the market over the last year is now declining.
“Even so, the healthy activity from new entrants to the market has been a terrific boost to trade-up buyers and generated a lot of sales activity among homes valued in the range of $600,000 to $800,000.
“The winter months are traditionally more quiet in the market, so it will be interesting to see how sales and prices progress through to June. I suspect it will be steady and confident but with a softening around rents in some areas,” Mr Airey said.
Data from REIWA for the March quarter, released last week, shows turnover lifted by 14 per cent across the state during the quarter as consumer confidence returned to property.
“It seems we have a new record for Perth’s median house price of $510,000, but it’s important to note that this is due largely to the composition of sales in which a greater volume of more expensive homes were being purchased,” Mr Airey said.
Around the state, some 13,200 properties changed hands, up from 11,600 in December and up by 12 per cent on the same time last year.
“However, the number of listings slumped to a relative low of 8,260 properties, given that around 12,000 is considered normal for Perth,” he said.