Perth Property Investment

According to the Australian Bureau of Statistics, house prices in Perth fell 6.8 percent in 2008 after prices climbed over 50 percent in previous two and a half years. This has led to many properties being taken off the market and put up for rent seeing vacancy rates rise to over 3 percent. However the rental market remains relatively tight with annual rental growth growing at 17 percent during 2008.

Prices in the Perth property investment market may need to soften further to see any significant increase in buyer activity. Economic conditions are tipped to slow in 2009/10, thus compounding the problems facing the Perth property market, as employment and wages growth slows, investment spending in the resource sector declines and migration rates ease.

As a result house prices in Perth are forecast to decline by approximately 2 percent in 2009/10.

However, a more significant downturn in property prices due to the downturn in the resources sector is not expected. With the slowdown in construction activity expected to continue to 2010, the stock deficiency is expected to climb to an estimated 8700 dwellings by June 2010 also, relatively high migration is projected to keep underlying demand solid in the coming 2 to 3 years.

This should prevent anymore significant downturn in house prices, with a total decline in prices forecast of 5 percent by the end of 2010.

Investors are increasingly looking towards Melbourne and Brisbane property as an investment option due to stronger long term fundamentals in these cities.

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