Perth leads Australia’s property market surge
During February, residential property values rose 0.6% across Australia with Perth recording the highest increase at (1.8%), followed by Adelaide (1.1%) and Brisbane (0.9%). Hobart was the only city to record a contraction, falling by 0.3%. Dwellings in Perth rose by 5.2% over the past quarter and by 18.3% over the past year. (CoreLogic, 2024)
In the Perth market, the median days to sell a house decreased to just 8 days during February. This is one day faster than January 2023 and 8 days faster than the year prior. (REIWA, 2024)
According to REIWA, there were only 4,101 properties listed for sale during the week ending 25 February 2024. This number of listings is higher than the 3,860 recorded four weeks prior but represents a decrease from the 7,335 listed in the same week last year.
The graph below demonstrates the downward trend in stock availability within the Perth market.
Source: REIWA and Momentum Wealth Research
Continued decline in rental property availability
The median rental dwelling price in Perth rose to $630 per week in February 2024, which is 18.9% higher than 12 months ago. The median rental price for houses increased to $650 per week during January 2024, while the price for units remained steady at $580 per week.
There were only 1,734 properties listed for rent in Perth during the week ending 25 February 2024. This is a decrease from the 1,958 recorded four weeks earlier, and closer to the 1,712 properties recorded at the same time last year. (REIWA, 2024)
The graph below illustrates the decline in the number of homes available for rent in the Perth market.
Source: REIWA and Momentum Wealth Research
RBA holds cash rate, signally peak
With the annualised CPI growth rate continuing to soften since its peak in December 2022, the Reserve Bank of Australia (RBA) opted to leave the cash rate on hold at 4.35% on 19 March 2024. This decision was a relief to many households feeling cost of living pressures.
The RBA’s decision to leave the cash rate on hold was more straightforward than in December, as they considered the risk of inflation not returning to the Board’s target within a reasonable timeframe had eased. However, despite there being encouraging signs that inflation is moderating, the RBA’s economic outlook remains uncertain. The RBA forecasts inflation to return to the target range of 2-3% in 2025, and the midpoint in 2026. (RBA, 2024)
CBA, Westpac, NAB and ANZ have all recently revised their forecasts to indicate that the cash rate has reached its peak of 4.35%. All four major lenders are expecting the cash rate to stabilise before beginning to contract from September 2024 and into 2025.
Source: RBA