Have you been considering the purchase of a property, either as an owner-occupier or as an investor, but unsure of whether or not now is the right time?
Well…the good news is… it’s the perfect time to take the next step if you’re looking to purchase within the Western Australian property market.
Despite various degrees of uncertainty around WA property values and the predicted post COVID-19 market recovery, there are still clear indicators that the timing is ripe for savvy investors looking to make the most of unprecedented opportunities.
In this article we will explore some of these aforementioned opportunities available to buyers and investors, whilst also outlining the benefits of acting quickly.
We’re In A Buyer’s Market
Perth is currently navigating a time where property values have never been more affordable, creating a ‘Buyer’s market’ of sorts where owner occupiers and investors have the power to acquire new properties at bargain prices.
This is particularly true for first home buyers looking to enter the local market for the first time. Recent figures released from the Master Builders Association in March 2020 showed Western Australia as the second highest percentage of first home buyers within the nation, sitting at 37 percent, indicating highly affordable entry points for buyers looking to acquire their first property. Land and house prices are also currently sitting at highly affordable levels, with future forecasts predicted growth within the coming months.
Sourcing Finance Has Never Been Cheaper & Easier
Since April 2020 when the RBA slashed the interest rate to 0.25 per cent, it’s never been more affordable to secure finance. This increased level of financial support will ensure buyers and investors have more opportunity to purchase their dream property within the active buyer’s market.
Lending conditions are also tipped to change, alongside The Australian Prudential Regulation Authority who are also looking to change the way banks assess the maximum borrowing capacity of homeowners, and according to industry analysts, this could translate into as much as a 10 to 15 per cent increase.
Financial experts are also predicting as many as 3 reductions in repayments over the coming 12 months, which will translate into more manageable and affordable mortgage repayments.
Forecasted Economic Growth
Whilst the impact of the Coronavirus is still ongoing within the national economy, the International Money Fund recently released forecasted figures which predict a 6.1% increase in the domestic economy within 2021 (assuming efforts to contain and manage COVID-19 are successful).
This brings an increased level of economic confidence within the nation, supported by renewed activity within our mining sector, where a predicted 12 months of steady growth is tipped to help kick-start our economy once again. This should bring with it an increase in labour demand over the coming years, which will have a positive knock on effect for employment levels, as well as population growth – both key measures of national economic growth.
It is expected that the property market will align with the increase in economic growth, so now is the perfect time to acquire a property before housing values rise.
Further Support From Government Grants
The Perth property market is going through an unprecedented time of government assistance for buyers and investors looking to acquire property.
It is the perfect time to take advantage of the various grants available, with numerous financial incentives helping to create a highly affordable market for established property owners, investors and first home buyers.
Some of these incentives include:
The Homebuilder Grant
This limited-time grant provides a $15,000 federal rebate for first home buyers and owner occupier buyers to assist in either purchasing an off-the-plan apartment, or for building a new home. Offer expires 31st of March.
First Home Owner’s Grant
The one-off $10,000 payment is available for first home buyers to purchase or build a new residential property (which also includes off-the-plan apartments) to use as their primary/principal place of residence.
Stamp Duty Rebate
Available to WA first homebuyers, owner occupiers and investors, this rebate covers 75% off your stamp duty costs, ranging up to a total value of $50,000 when buyers sign a pre-construction contract to purchase an off-the-plan apartment before the due date of October 2021. Once construction commences buyers are still eligible for a stamp duty discount but only up to a total value of $25,000.
These grants provide exceptional support to get around the initial barriers to purchasing a new property, and whilst these are available according to specific criteria, they are also subject to availability, so if you’re in the market to purchase a new property, these grants won’t be around forever.
The Time Is Now!
Many buyers and/or investors are keeping a close eye on the WA property market despite uncertainty and discussions centered around property prices, market growth and key drivers of economic growth such as population growth and consumer confidence.
Whilst we aren’t quite out of the woods with COVID-19 just yet, there are signs of optimism on the horizon for the Perth property market, and savvy buyers and investors now have the opportunity to invest at affordable price points to beat the curve ahead of predicted housing value increases.
If you’re considering the purchase of a new property in Perth, the time is now!
We welcome you to contact our team for a discussion on our range of quality and affordable properties throughout the Perth suburbs.
APRA’s predicted 10 to 15 per cent increase from changes to borrowing capacity of homeowners taken from this Dale Alcock article.