However, when purchasing a property in this State, it is important to consider the heavy economic reliance on the mining industry and resources, especially the extent to which it underpins employment and population stability.
Managing director of Realmark, John Percudani, has witnessed multiple property cycles over the 35 years the company has been operating and has seen how the mining industry has previously affected the State's housing market.
“In the last mining downturn, Western Australia saw the majority of property prices trade sideways for many years leading to a large percentage of homeowners to be in negative equity.” said Mr Percudani.
This year iron ore prices have slumped close to 20% with nickel and lithium price also dropping.
However, Perth’s median house price continues to rise, with a new record set in March of $620,000 according to REIWA.
Mr Percudani said the mining industry is a big part of Western Australia and as history shows it can affect the property market, so it is important to understand the conditions before investing.
“There are certain suburbs and towns that would be affected more by a potential economic adjustment,” he said.
“However, the current combination of WA’s population growth, influx of eastern state investors and strong rental yield combined with ongoing limited new housing stock is creating a historically competitive market and an increase in property prices.
“In this current context, any significant shift in the mining industry will impact the property market as it has in previously WA cycles.”
Mr. Percudani predicts the property market and buyer activity will remain high in the short term due to the common theme of population growth and migration built on a strong economy, with interest rates and supply the cautionary factors.
For personalised advice and insights from a local property expert reach out to Realmark today on 9382 0999.