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Western Australia heads the rankings in the latest Housing Institute Association (HIA) report on building activity. The report measures 13 key indicators against long term averages, resulting in a rating for each component and an aggregate score. This is the first time the state has led Australia in this regard since mid-2006.
The construction sector is closely linked to the number and quality of houses for sale in Perth. Granger Clark illustrates how and why WA tops the ratings on several of the key indicators and explores how this will impact on real estate in Marangaroo, Madeley and other Perth suburbs.
The Government’s Keystart Home Loan scheme has had greater impact in WA than any other state and this was reflected in the results. More loans were given to first homebuyers in Western Australia, freeing up capital to invest in building.
If population growth continues to slow, as it currently is, an increase in new houses will result in an imbalance between supply and demand and a buyers’ and tenants’ market. Whether you’re looking at houses for sale in Ellenbrook, houses for rent in Ballajura, increased supply will place you in a strong position to secure real estate throughout Perth.
In an encouraging sign for this sector of the industry, approval for new homes was significantly higher than Western Australia’s decade long average. Approvals for detached dwellings rose to more than 17% above the state average and equivalent statistic for multi-unit dwellings was 47% better than average.
These approvals are expected to translate into construction and a greater number of houses on the market. The impressive statistic for multi-unit dwellings in particular, suggests significant growth in both the number of Perth rental properties and houses for sale in Perth.
The state also performed strongly in the renovations indicators, both in the value of the work approved and the amount of private expenditure dedicated to the work. This suggests that people are willing to invest heavily in their properties and may lead to an increase in average house values in the future.
This willingness to undertake alterations is a positive for real estate in Western Australia. It will increase the value of houses for sale in Perth and beyond and offers buyers greater amenities and incentives to purchase. If trends such as these continue they can significantly boost the median sale price for houses over the long-term.