A return to positive interstate migration and a strong outlook for the resource sector is helping propel Perth’s housing market ahead of Australia's capital cities.
CBRE predicts Perth’s residential market is on track to record double-digit growth for the first time in 11 years.
Perth house prices are tipped to grow between 9 per cent and 12 per cent this year, while unit prices could lift between 5 per cent and 7 per cent, according to CBRE’s 2021 Australia real estate market outlook report.
CBRE’s head of residential research Craig Godber says federal government incentives such as Homebuilder and state support packages are boosting Perth’s construction sector, “further contributing to growing confidence in the market”.
“Supply also remains tight, with vacancy already sub-1 per cent which is leading to strong rental growth,” Godber said.
House price growth forecast: 2021
|Sydney||7% - 10%||0% - 3%|
|Melbourne||3% - 5%||0%|
|Brisbane||7% - 10%||3% - 5%|
|Perth||9% - 12%||5% - 7%|
|Adelaide||5% - 7%||3% - 5%|
|Canberra||5% - 7%||0% - 3%|
^ CBRE Market Outlook report 2021
The nation's housing market has recorded increasing property prices since the middle of 2020, fuelled by heightened demand for property, low volume of available stock for sale and historic low borrowing costs.
As such, CBRE forecasts that Sydney could record house price growth of between 7 per cent to 10 per cent, and units a 0 per cent to 3 per cent rise this year.
Brisbane’s housing market is forecast to record a 7 per cent to 10 per cent lift, while units could record between 3 per cent and 5 per cent increase.
The report forecasts 5 per cent to 7 per cent growth for both Adelaide and Canberra’s housing markets.
Adelaide unit prices are tipped to record a 3 per cent to 5 per cent rise, while unit prices in the nation's capital could record an uptick of up to 3 per cent.
CBRE expects Melbourne house prices to lift between 3 per cent and 5 per cent in 2021, and no increase forecast for Melbourne unit values.
The report shows regional value growth outpaced metropolitan values in all states last year, except in Western Australia.
Monthly capital city price growth has outpaced regional price growth for only the second time in 12 months according to REA’s new Insights Home Price Index.
While price growth in capital cities has been stronger than in regional markets over the past two months, REA Group economic research director Cameron Kusher notes it will be interesting to see if the trend continues as vaccines roll out in Australia.
“Undoubtedly the lure of regional Australia with its lower property prices and desirable lifestyle remains strong, but we may see those who intended to make a tree-or-sea-change reconsider their regional move as cities reopen,” Kusher said.
Across the board, the REA price index found house price growth in February, up 0.4 per cent, continues to outpace unit growth, up 0.1 per cent in the month.
Over the past 12 months, house price growth of 6.9 per cent has more than tripled unit price growth, up 2.1 per cent, for the period.