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WA property market recovery confirmed by data 11/11/2017

Many commentators have been forecasting the bottom of this property market cycle over the last six months or more and, finally, the hard data is starting to confirm the positive sentiment that has been brewing, with recent building approvals data representing positive growth.

Many commentators have been forecasting the bottom of this property market cycle over the last six months or more and, finally, the hard data is starting to confirm the positive sentiment that has been brewing, with recent building approvals data representing positive growth.

The Australian Bureau of Statistics (ABS) released monthly Building Approvals figures last week that show the number of total dwellings approved in Western Australia is trending upward, with an increase of 2 per cent in September.

This is the fifth month in a row that dwelling approvals have increased, reflecting a growing level of activity in the new home market.

Importantly for the broader economy, the value of residential building in WA is also up to $511.9 million for the month. That is up from $510.9 million in the previous month and $489.6 million in January this year.

This increase in value has a positive flow-on effect to a range of building and related industries.

As I mentioned in my column a couple of weeks ago, the health of the property industry in WA is critical to the broader state economy given that the construction industry is the second largest employer in the state.

UDIA called the bottom of the market earlier this year in an industry presentation where UDIA WA CEO Allison Hailes said that the market had progressed past the bottom of the cycle and was beginning its eventual recovery.

This statement was reinforced by UDIA’s Urban Development Index, which has recorded increased sales in Greater Perth of 8.9 per cent on a year-on-year basis. At the time, the most recent quarterly data also showed a 3.7 per cent increase in the average price of new land.

UDIA’s predictions have also been reinforced by a range of industry experts who have provided their perspective on the market, including Col Dutton from Stockland, Paige Walker of Mirvac and Peet’s Paul Lakey.

In fact, Kerry Stokes was recently in WA for a WestBusiness leadership event and stated that, “right now any young person out there, any apprentice, worker, tradesman — the best thing they will ever do in their life is walk out this weekend and buy a home in Western Australia.”

You can’t get more to the point than that.

Overall, the latest data is good news for WA homeowners and those considering purchasing now as we head toward the Christmas period and look forward to 2018, when we can expect further positive growth in Perth’s property market.

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