Last week’s interest rate cut could trigger a rise in interstate investor activity for the Perth market.
Professionals Real Estate chief executive Shane Kempton said the group had already been seeing renewed interest in the Perth market from investors outside Western Australia.
This applied particularly to investors from Sydney and Melbourne, where prices have jumped significantly in the past two years, according to Mr Kempton.
“A growing number of these investors will come from interstate due to the fact Perth properties are now competitively priced compared ith major eastern capital cities,” he said.
Mr Kempton said the recent interest rate cut would give investors another reason to buy Perth property.
“First, baby boomers who have cash savings in the bank will be getting even lower returns on their money,” he said.
“Second, it makes it even more affordable to buy a property in Perth, where weekly rents have stabilised and rental returns are improving due to more competitive house prices.”
Mr Kempton said astute investors who buy in the right areas can still achieve double-digit capital growth rates in Perth.
“The top 10 suburbs in Perth for the year ending the March 2015 quarter achieved annual growth rates in property values of between 11.5 per cent and 24.8 per cent,” he said.
Mr Kempton said investors don’t need to buy into an expensive suburb to see impressive capital growth rates.
“The median house price in Coolbellup increased by 21 per cent to $550,000 over the past year,” he said.
[Related: Perth rentals increase 210pc in three years]