Property oversupply to reverse after election

Property oversupply to reverse after election

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A high-profile industry figure has said Perth’s current property oversupply will be short-lived and will begin to tighten once the federal election has passed.

RE/MAX WA managing director Geoff Baldwin said despite there currently being more than 20,000 properties for sale across Perth, the excess is part of the "normal cycle" and will start to turn around following the election.

"In regards to the current oversupply, buyers are now re-entering the market and we are also seeing more and more investors recognising the value around at the moment and this increasing activity tends to have a snowball effect," he said.

"Once people see ‘under offer’ and ‘sold’ stickers appearing on signs, they tend to move a lot more quickly. Historically this has resulted in a quick reduction in stock and more pressure on prices.

"It is inarguably a wonderful time for people to buy, however, people thinking of buying or upgrading should do so in the short term rather than believing these conditions will last forever."

Mr Baldwin noted that regardless of the wider options available in Perth at the moment, there are only a limited number of "bargains, and even less that will fit a particular buyer’s requirements".

"The trap in this market is that buyers think the well-priced properties will still be there tomorrow and next week and hence they hold off; however, in any market the best properties are the ones that sell and they sell quickly regardless of market conditions," he said.

"We are now seeing buyers contacting us to place offers on properties they viewed several weeks ago only to be informed that they have missed out because the properties have sold, often resulting in significant disappointment.

"We are also seeing upgraders who have made offers that are subject to their current homes selling but who are missing out because they are holding out for an unachievable price despite negotiating a great deal on the new home."

[Related: Sydney market drives up national dwelling values]

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