Buying a House in WA - Where Do You See Market Going?

Gerbud on 12/01/2017 - 10:15

Hi all,

Myself and my partner are looking at buying a house in WA. This would be our first home and we would want to live in it for the foreseeable.

As the market here seems a little shaky with negative property price growth in 2016 and poor Australian GDP for the Sep QTR, I am contemplating putting our search on hold to watch how economic factors play out. We are currently renting and have been the past 5 years so keen to get on the ladder.

Just interested in getting people's opinion on the housing market in WA and where they see it going.

Thanks a lot.

G

Home & Garden

Comments

  • Stalker on 12/01/2017 - 10:39
    +1

    Pretty flat for the next 12 - 24 months I reckon, with probably still a few % to come off prices in general. Not a bad time to get in to some of the more desirable areas and I suspect there will be a general trend of people 'upgrading' from the fringes to more central or coastal areas as some people leave the state due to work prospects etc.

    My advice, start looking, get your pre-approval for finance etc, and play hard ball being prepared to walk away if the sellers don't come around - its a buyers market. ;)

    • Gerbud on 12/01/2017 - 10:51

      Thanks! Interested you mentioned about sellers not coming around - I am finding a lot of them seem quite set on listing properties at boom prices and being "insulted" with respectable below asking price offers!

      • Stalker on 13/01/2017 - 11:42
        +1

        We've recently moved and walked away from 2 places that we thought we really wanted as the buyers wanted 'boom' prices - ie. recovery of what they paid for it at the height of the market, which sadly isn't going to be a reality. So we waited it out a few more months and then our dream house came on with realistic sellers. We then had to also accept a bit less that what we wanted / thought out our place was 'worth', but it sold first home open and 3 months in we couldn't be happier.

        It doesn't always line up that way of course, but being realistic and taking the emotion out of it goes a long way to help. ;)

  • inherentchoice on 12/01/2017 - 10:53
    +1

    Experts are forecasting from 0% to -9% in Perth…

    http://www.afr.com/real-estate/2017-predictions-on-how-austr…

    But even these experts got it wrong for the last two years running…

    http://www.afr.com/real-estate/residential/how-housing-marke…

  • Skramit on 12/01/2017 - 10:57
    +1

    As above, it's a buyers market, so get cracking on some low-ball offers on your dream house. You never know :)

    Given it's for you to live in, and not an investment property, there's no such thing as a "bad time" to buy. 'The market will do what it will do' over the next 10 years, you can't control it. If you want a permanent house then it doesn't matter what the market does around you in the short and medium term, once you're in the market and happily living there.

    Even if the median house price dips a few % over the next little while, do you honestly care? If you're in a nice house that you like now, and not renting any more….. you're winning.

    • Fexofenadine on 12/01/2017 - 20:55
      +1

      There might not be a 'bad time' to buy, but if you buy and the price drops six months later, you'd be kicking yourself for not waiting and being able to reap the cheaper price! (I know, I know, you never know exactly how the market is going to move and there are other advantages of buying early, but just wanted to provide another perspective…)

      • Skramit on 12/01/2017 - 21:02

        Nah. If you buy and 6 months later you have moved and and you'll have no way of gauging if your individual property would have dropped or risen in such a short time period.

        Sure some housing analyst might tell you WA housing has dropped 0.06% and you can do a calculation, but as if you'll give a crap at all. The figure is a market average so perhaps your property didn't change at all or maybe it went up if in the right area.

        If there was a 40 or 50% price drop on the whole market, fine I agree with you, but that's sooooooo unlikely.

        There's so many what ifs. You buy when you need to and what you can afford. Golden rule for a place to live in. Investment properties is different.

        • Fexofenadine on 12/01/2017 - 21:03

          Very true, good points. Hard to get out of an 'investment' mindset sometimes :P

        • Skramit on 12/01/2017 - 21:12

          @Fexofenadine:

          Yeah. You sounded like my brother when he was trying to buy his first home. Spent hours and hours and hours working out the suburbs going up or down and wasted a tonne of time. In the end bought somewhere completely different. :P But every month he'll calculate how much "money he's made" on his house based of some commsec report on his suburb or whatever….. zzzzzzzzzzz

  • basl on 12/01/2017 - 12:02
    +2

    Hi OP,

    Also in WA, we have been saving/watching for 2 years now and prices are still def dropping. I cant see things improving in 2017. We also have noticed that rents are still slowly dropping two - you could ask for a reduction. Estimates for reports have been -1% to -9% so not really growing

    I would suggest if you are like us (and have no reason/urgency to buy)i would hold off till you get your 20%. We are looking at the end of this year to purchase our first home - and like you we want to stay there for a long time

    Good luck!

  • Wampus on 12/01/2017 - 12:08

    Another option is to buy in an area with positive growth e.g Sydney, and get that to pay for your rent in Perth

  • applec on 12/01/2017 - 12:10
    -1

    I am flabbergasted that most people that are looking to buy or put in an offer in WA does not first get pre approval. I have experienced personally & seen a few friends where sale did not go through as finace was not approved. Such a waste of everyone's time. You can't even keep the deposit they had paid as penalty!

    Real estate is so different between Sydney & Perth. No one would ever dream of putting in an offer or bid at auction without pre approval in Sydney unless of cause its a cash sale

  • JimB on 12/01/2017 - 12:45

    In Perth, there's a high chance there is no growth or drop in price.

    There's little chance it will go up.

    So there's no rush to buy.

    Have a look and if you see something unique you really like, then make a low offer. Otherwise, for a normal house, make a really low offer.

    • Skramit on 12/01/2017 - 21:03

      Also talk to agents, find out wheich vendors are desperate to sell :)

  • mskeggs on 12/01/2017 - 12:54
    +2

    You guys are so un-Australian.
    Look in any thread about Sydney or Melbourne property and you will see confirmation that Australian real estate only ever goes up, and that prices are still low. All your facts and figures must be nonsense in the face of that true fact!
    It's as if you West Australians might have started treating property as an investment class rather than a speculative bubble. Crazy. Please don't infect the patriotic East Coast property market with your realism and value metrics.

  • Rifraf on 12/01/2017 - 19:47

    Neighbour bought at a similar time to me moving in.

    They paid approx 398.000 and have done lots of spending due to originally planning on living there.

    This approx 4 years ago in Northern Suburbs of Perth.

    They have carpeted, curtains, large wooden deck and done a gazebo(?) roof over deck between house and garage.

    I forget how much their air con install cost but remember it was huge.

    Their unit currently at 50,000 below original purchase price.

    Its been under offer twice (currently under second offer).

    Its been for sale for over 6 months if memory serves

    Thus I believe realestate here abouts is going down the gurgler

    • Fexofenadine on 12/01/2017 - 20:53
      +1

      Anecdotes are not data! But in this case yes, the overall data does appear to suggest a price correction in Perth at the moment.

      • Rifraf on 12/01/2017 - 21:59
        +1

        Not to mention Perth being an over heated sandpit anyway.
        Too cold and wet in Winter/Spring and too hot in Sumer (though in fairness the first part of summer has been cooler than usual and somewhat pleasant).
        Forget about the beaches…. too many damn sharks.
        The suburbs all look the damn same and the shopping centres for the most part look tired and dated.
        The ones that don't, have something like a Westfields with all the same shops.
        Freo is an exception except whilst it has some character, its looking a bit tired.
        Midland looks like the town centre hasn't had a coat of paint in 50 years.
        The less said about Armadale the better and Mirrabooka is pure Apache country.
        I'm thinking about a move to Tassie.

  • Fexofenadine on 12/01/2017 - 20:56

    I think now is a decent-ish time to buy, prices are low. They definitely aren't getting higher any time soon, but I don't think they are going to go too much lower. But like others have said, take your time, find the property you want and make an offer. Best of luck!

  • Gerbud on 13/01/2017 - 14:41

    Many thanks for all the interesting responses - much appreciated! Seems like the consensus is that prices aren't going up for a while yet!

  • goodcopbadcop on 13/01/2017 - 18:44
    +1

    The prices of Perth houses during the mining boom was truly ridiculous. I lived, bought and sold there before the boom but went back to visit family on a regular basis. Prices for everything during the boom time were as if they thought it was Sydney. And all because there were people with money. But the money has gone and so too have a lot of the people, but the mindset of high prices still exists. A cup of coffee still costs more in Perth than places in Sydney. Some sellers have mortgage stress but still won't budge on the selling price believing that the market will pay. Prices soared and some lucky people sold up during that time and made a heap of profit. this often happens in upcycle markets. It is simply reflecting the real estate cycle that applies everywhere - but Perth's has a known event for the upturn and the down turn.

    As it is a buyer's market at the moment, you do have time to find the right property for you. It is difficult to predict if the cycle has bottomed out until we look back and in hind sight can say yes or no because of prices. But if you have researched the market well and watched prices you will be able to determine what is value and what is overpriced.

    Remember that every fortnight's rent that you pay is helping to pay someone else's mortgage! Renting is dead money and while interest rates are the lowest they've ever been - so buying your own place will at least be contributing to build your assets and not someone else's. The sooner you can get into your own place - the better placed you are to make money on your property when prices do go up.

    It is definitely not the high point of the cycle - and may go down proportionately - but it is a much more pleasant experience purchasing when it is a buyers' market than when it is a sellers market, that is for sure.

  • mskeggs on 16/01/2017 - 12:48

    This report was just released, might give some ideas:
    https://www.lfeconomics.com/Blog/perth-smashed-avocado-toast…

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