Professionals Real Estate The WA Property market should rebound over the coming year due to the increasing numbers of people moving to the State according to David Hobbs, CEO of Professionals Real Estate Group.
Mr Hobbs said that the latest ABS population growth figures for 2009 showed that Western Australia had the highest population growth rate of any State or Territory in Australia, growing at an annual rate of 2.7%.
“Overall, the State/s population grew by more than 58,000 people over the year. These rising population figures occurred during a time when the construction of new homes was being hampered by tighter lending requirements by the banks as well as rising interest rates. A key driver of our population growth rate is the large number of overseas migrants moving to Western Australia with over 38,000 moving to the state during the past year. Professionals believes that the rental market will be the first sector of the real estate market to improve during the coming financial year followed by real estate sales. Our group is already seeing signs of an improvement in the rental vacancy rate in some areas of Perth and we expect this trend to continue into the coming financial year as more migrants move to Western Australia. Traditionally, migrants tend to rent for a number of years before deciding to buy and this is why we believe that vacancy rates will fall, combined with the fact that there are fewer first home buyers in the market which also places pressure on the rental market. Developers are also finding it harder to secure finance to construct investment properties which limits supply at a time when demand is rising,” he said.
Mr Hobbs said that an improvement in the rental market would see a resurgence in investor activity in the Western Australian real estate market as falling vacancy rates are generally followed by rising rents.
“House prices have now levelled out and conditions are now set to improve rental returns for property investors in the local real estate market. Gross rental yields in Perth are now around 4% in Perth and if house prices remain steady and rents begin to rise, these rental yields should begin to rise, in turn encouraging more investors back into the real estate market,” he said.
Mr Hobbs nominated the following ten affordable suburbs for first time property investors seeking to enter the Perth real estate market during the new financial year:
- Clarkson
- Heathridge
- Padbury
- Westminster
- Ballajura
- Forrestfield
- Thornlie
- Coolbellup
- Leda
- Warnbro
For professional advice on taking advantage of the rising rental yields, contact your nearest Professionals office.
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