CoreLogic has released analysis on the change in house and unit values over the past decade throughout each of Australia’s largest sub-state regions (best known as SA4).
Below are the decade changes in house values:
And below are the decade changes in unit values:
You see from the above that Perth has been by far the worst performing capital city housing market in the nation.
In 2008, the median house price in Perth was almost on a par with Sydney. However, while Sydney’s dwelling values boomed, house values in inner Perth sunk 9.0% over the past decade, whereas they also declined in Perth’s south-east (-0.6%) and south-west (-0.3%).
In fact, the only growth recorded in Perth was in the city’s north-west (+2.2%) and north-east (+1.5%). However, once inflation is taken into account, the value of houses even in these areas has fallen heavily.
Perth’s apartment market has been hit even harder. Inner Perth apartment values have tanked 19.5%, whereas Perth’s south-west (-16.1%), the north-east (-13.7%), the north-west (-13.4%) and the south-east (-2.0%) have also bled losses.
Property investors in Perth have also been smashed by falling rents, which have collapsed by 18% since December 2014, according to the ABS:
The immediate outlook for Perth property is also poor. Home sales are still falling, which should weigh on prices:
Whereas housing finance has begun to roll:
Finally, despite construction levels crashing, new dwelling supply continues to easily outpace weak population growth:
From the second chart above, there were 19,400 net dwelling additions across Western Australia in the year to March, compared to an increase in Western Australia’s population of just 21,395.
This ongoing oversupply should ensure that Perth’s housing market remains in a funk for the foreseeable future.
