REGIONAL markets are experiencing a resurgence with eight of 11 areas recording price growth in the December quarter according to reiwa.com data.
In southern WA the Busselton urban area was the top performer with 9.8 per cent growth, followed by the Albany urban area at 7.2 per cent and greater Bunbury at 2.8 per cent.
The data also showed the time on market in the South-West had decreased from 110 days in the three months to October 2016 to 104 days for the same period in 2017.
REIWA councillor Joe White said December and January were good months, with sales slowing slightly in February and March.
“However there is no doubt sentiment is improving, the number of listings is falling and the population is growing,” he said.
Mr White said population growth drove the property market and had not been as high as expected for WA.
“The predicted population growth was 1.2 per cent, however this now appears to be optimistic as the census data would indicate we are tracking at about 0.7 per cent,” he said.
“Given that population growth underpins the property market, with these figures it would be unreasonable to expect any recovery in prices in the near future.”
However, he said there was cautious optimism for the South-West, which recorded 2.7 per cent population growth, nearly four times the state figure, making the region WA’s hotspot.
“On balance, I believe we are past the bottom of the market as we are seeing a recovery in sale prices of development sites which would indicate that there is a growing confidence looking forward,” Mr White said.
“Holiday-home buyers have re-entered the market, though cautiously, people are buying the 50 year old asbestos cottage and demolishing to rebuild to live there, entry level activity in places like Dunsborough Lakes is extremely strong, but the main driver for sales is still people moving from Perth to the South-West to actually live.
“Technology is supporting this – you don’t have to live where you work anymore as your work is portable and a spare room, lounge room or cafe could become an office.”
Improved amenity in the South-West was also supporting population growth.
“We have hit a critical mass where the retention factors – hospitals, schools, sporting facilities etc. – are largely there and the expanded airport will add to this.
“And, despite the many complaints, let’s not underestimate the value of the NBN.”
Mr White said supply could become an issue for some parts of the market.
“The challenges in the faster growing areas like Dunsborough will be ensuring sufficient land supply to ensure we don’t face another affordability crisis on the back of the planning lagging behind the demand,” he said.