South West WA May 2017

The month in review: South West WA

By Herron Todd White
May 2017

The major centres throughout the South West have seen sales volumes remain stable after weakening in the first half of 2016 and then levelling out through the remainder of the yea; however, the residential market within rural-residential localities and inland townships throughout the South West have continued to soften.

The top end of the market continues to be soft with overall weak demand. However, there does seem to be reasonable demand for well-located properties that present to a high standard. The rural-residential market is also continuing to slow with the majority of sales being below $1 million and experiencing extended selling periods.

Vacant land values have now started to level after seeing a correction throughout 2016, but volumes are down slightly from previous years.

The rental market remains stable after a decline in the first part of 2016, and then a levelling out.

The swings of the Perth market during the past several years have been missed in the region as the locality benefits from strong population growth. The South West is a desirable place to live and as such naturally attracts continuous growth, mostly fuelled by young families, retirees, and fly-in, fly-out workers.

On a local level the region would benefit from the expansion of the Busselton airport. The airport is looking at attracting more interstate and some international flights. This would fuel the tourism industry and have a positive effect on job creation.

At a state level the South West would benefit from the Perth market improving. This market has already started to stabilise and historically a strong Perth market flows into the South West as many mum-and-dad buyers and small-time investors look at investing in a holiday home in the South West.

On a national level the continuation of low interest rates is paramount.

If interest rates were to rise, population growth to slow, and the Perth market to soften, we would expect the South West market to decrease.

Overall the property market in the South West is soft, but it has stabilised since the decline seen through the first half of 2016.

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