Perth is well-known for having one of the most expensive housing markets in Australia, and the value of real estate has been increasing in recent years. In fact, approximately 39 communities in Perth currently have an average value of at least $1 million, and many have an average value that is two or three times this. The current trend indicates that property values in Perth will continue to increase in the coming years in different communities throughout the metropolitan area.
Rising and Falling Property Values in Perth
It is important to note that not all property values have increased in Perth over the last year or two. In fact, recent data indicates that eight communities in Perth that previously had property values of more than $1 million on average have decreased below this level. However, several areas that previously had an average property value below $1 million have increased above these levels in the past year. While some areas have declined, there currently are a record number of million-dollar homes in the metropolitan area. In fact, the number of properties that have a value of $1 million or more in Perth is up 32 percent over last year.
Communities with the Highest Values
Peppermint Grove is considered to be one of the most elite and coveted communities in Perth, so it is not a surprise to learn that this community continues to be at the top of the list of highest priced communities in Perth. Its average property value is more than $3.5 million. While this is very high for Perth, it only ranks sixth in Australia. The most expensive community in Australia is Point Piper in Sydney, which has an average value of $5.5 million. In WA, Dalkeith is the second most expensive suburb at $2.4 million, and Cottlesloe ranks third with a value of $1.8 million. In other suburbs such as Mosman Park and Waterman’s Bay, luxury homes fetch an average price of $1.3m and $1.2m respectively.
The Economy in Perth
It is interesting to note that Perth real estate values have generally be increasing in recent years despite the fact that the economy has slowly been in decline. The city’s economy was largely inflated due to a mining boom, but there has been a decline in the mining industry in recent years. This has resulted in various other sectors of the economy also declining significantly. Because of the slowing economy, some experts predict that real estate values may decline within the next few years across the board. Others, however, believe that the location of the property and its desirability will be a strong indicator regarding whether property values in a specific Perth community increase or decrease. The fact that some real estate values have fallen below the $1 million mark while many others have increased above this level may be a sign that the latter prediction may be more accurate.
What to Keep in Mind When Selecting a Property to Purchase in Perth
Most buyers consider real estate to be a long-term investment, so a temporary decline in value after purchasing it may not be a major cause of concern. However, because the economy may continue to decline in Perth in coming years before it ultimately stabilizes and begins to improve, it may be wise for investors and buyers to spend time closely analyzing the desirability of specific communities in Perth before making a buying decision. Others factors, such as the features, square footage and more, should also be desirable for the buyer.
While there is a general uptick in real estate values in Perth, this increase is not seen across the board. Those who are thinking about buying real estate in Perth should take time to learn more about the factors that are causing increases and decreases within specific communities before making a final buying decision.