Perth stock plunge: How agents cope in a low-listing market 

REB’s managing editor Liam Garman has sat down with WHITEARCH director and licensee Ashby Farrell to discuss Perth’s record listing shortage and the effects on agents, property managers and buyers.

Farrell said that amid the shortage, listings were spending an average of eight to nine days on the market, with the total number dropping to around 2,500.

“To put it in perspective, in Perth for the last five years, we’ve been selling 900 to 1,000 properties per week. That means if no one put their property on the market for two weeks, we'd have no stock,” he said.

He added that agents had been feeling the weight of the shortage, especially the top-performing agents, who were used to having 10-20 listings and now had only three or four.

“Most agents are going to do 20 or 30 per cent less in terms of deals this year just because they're not going to be able to get as much stock.”

“Transactions are going to keep flying, but there's just not going to be as much stock to sell. I can say for myself, I'm definitely doing less this year than I was doing last year.”

According to Farrell, the “catastrophic” shortage had been an issue for several years, beginning in 2022-23, when the average number of days on market fell to eight or nine.

He said the number had only begun to stabilise at the beginning of last year, before plummeting again to previous levels around April or May.

“This coincided with interest rates being lowered, so buyers had a bit more confidence to go out and buy something, as well as the 5 per cent scheme coming in later in the year as well,” he said.

Farrell said another major factor has been property owners' reluctance to sell, holding onto their properties to reap the benefits of price growth.

"Most of the people that I'm speaking with are saying, 'I'll just keep waiting, I'll just hold it. It's not costing me anything.”

He said agents who were more likely to succeed and secure the most listings were those who already had strong relationships, networks, and databases to fall back on.

“They're going to be fine because they can still have touch points with these people that they've been talking with for years.”

Meanwhile, he said the difficulty would be for agents who didn’t already have an established relationship with buyers and were just starting to build their networks.

“If you just came in and decided to try and sell, you've got to obviously meet people and build a database of people that don't know other agents, which is difficult.”

While agents have had to adapt to the changing Perth market, Farrell said the property management arm of his business has also faced greater difficulty in recent years.

He said that while rents had risen, allowing property managers to earn more, business was declining because many properties were going to owner-occupiers rather than investors.

“There are less investors available in Perth, so to get properties to manage is much harder than it has been in the past.”

“We might sell one of our rentals … and then a first-time buyer is coming along and using the scheme and buying that and then moving in. So we're losing the rental.”

Farrell said that despite the difficulties, he intended to bolster his agency’s rental division by continuing to create positive relationships with landlords.

“Our point of difference is that every landlord in our business has my phone number. They know that they can call me anytime. They know that they're going to get a call from me at least four times a year.”

“[I give them] updates on the market, I ask them if they have questions – ‘Are you worried about something that's happening with your property or with the team?’ That’s how we try and set ourselves apart,” he said.

Farrell said that freeing up stock would require investors to sell their assets, putting supply back into the market for owner-occupiers.

Additionally, he noted that owner-occupiers were hesitant to put their properties on the market for fear of not being able to find a new home.

“They can't actually buy another property, so even if they're making a million dollars on their home, there's too much risk to go find another property.”

“The only properties that could come to market are obviously new builds, and investors getting out, and the occasional owner-occupiers,” he concluded.

You might also like: [Scammers target renters in tight WA market]