Perth off-the-plan apartment market bouncing back, with strong buyer interest7 March 2018
Article by: Georgia Sweeting
After almost five years of subdued activity, several of Perth’s leading developers have cause for optimism in the off-the-plan apartment market, following an upsurge in local buyer interest and activity.
The number of apartment developments decreased significantly over the past two to three years following a tightening on lending policies and a decline in rental returns, which saw many projects put on the back burner or shelved indefinitely.
Blackburne Property Group founder and managing partner Paul Blackburne said the slowdown had been good for buyers because only projects of good quality and accurate pricing were selling.
“We are currently seeing nearly all of the supply soaked up as there has been very little construction over the past three years due to the market downturn,” he said.
“There is a lot of pent-up demand in WA, as many have delayed buying decisions but are now starting to flood back into the market at a time when supply is fairly limited. This points to strong price growth in the sector in the coming years.”
Mr Blackburne said his team had recorded more than $34 million in off-the-plan sales at Marina East in Ascot Waters since the project was launched last November, with local downsizers dominating the sales so far.
The development offers one-, two- and three-bedroom apartments as well as a limited number of penthouses. Prices start at $395,000 for a one-bedroom apartment and $995,000 for penthouses.
Just five kilometres from the CBD, and three kilometres from the new Optus Stadium, the development is part of the revitalisation of Perth’s east and is attracting buyers from suburbs across, Mr Blackburne said.
First-home buyers were one of the stronger performing sectors when it came to apartment sales, with many young people realising that now was a good time to get into the market, he said.
Finbar executive director and chief operations officer Ronald Chan said strong sales at the group’s Sabina apartment development in Applecross were being replicated at a number of the company’s other key projects across Perth.
“There are clear sings of renewed confidence in the market, not just at our Sabina development but across many of our developments across Perth,” Mr Chan said.
“From November we have seen an average increase of 30 per cent per month in off the plan sales. It’s clear that buyers in the current market can feel a sense of urgency, however the price, product and location are still fundamental in delivering strong sales at any apartment development in Perth.”
“First-home buyers are very strong in the affordable price range with a number assisted by parents to get a foothold in the market.”
Psaros Property Group’s managing director Mike Enslin said the market had tracked down since a 2013 peak, but a late 2016 pick-up in interest has carried through to this year.