Perth housing to lead the pack this year: CBRE

The WA capital is set to take off this year, having lagged the eastern states previously.

Perth is emerging as the pick of housing markets this year with real estate agency CBRE saying the city’s residential market is on track to record double-digit growth for the first time in 11 years. Picture: Thinkstock

Perth is emerging as the pick of housing markets this year with real estate agency CBRE saying the city’s residential market is on track to record double-digit growth for the first time in 11 years.

It picked the once laggard WA capital as leading the nation’s housing recovery in 2021 with homes to soar by up to 12 per cent as the resources sector shifts back into the sun.

The CBRE report shows regional value growth outpaced metropolitan values in all states, except Western Australia, during 2020, as demand soared for homes outside cities in the wake of the coronavirus pandemic.

“A significant preference shift has occurred, with the ability to work from home and lifestyle choices driving a shift towards regional markets and the smaller capitals,” said CBRE head of residential research Craig Godber.

The report predicts Perth’s residential market will be the nation’s frontrunner, with house prices expected to grow between 9 per cent and 12 per cent and unit prices to only lift 5 per cent to 7 per cent in 2021, confirming the relative weakness of apartments.

Property group REA this week also forecast that house prices would rise this year, with the regions set to outperform the rest of the nation and the luxury end of the sector the best performer in the major cities. Mr Godber said Western Australia’s economic backdrop was supporting the robust growth forecasts.

“A return to positive interstate migration, accompanied by a solid resources sector outlook, is helping propel Perth’s housing market recovery ahead of the nation. Federal government incentives, such as HomeBuilder and additional state support packages, are boosting the construction sector and further contributing to growing confidence in the market,” Mr Godber said.

Brisbane and Sydney’s residential markets are also poised for a rebound in prices in 2021, following a similar growth trajectory to Perth’s.

Sydney is expected to see house price growth of between 7 per cent and 10 per cent, while units will experience a 0 per cent to 3 per cent rise. Similarly, 7 per cent to 10 per cent growth is forecast for Brisbane’s housing market and units are on track to record a 3 per cent to 5 per cent value uplift.

The report predicts 5 per cent to 7 per cent growth for both Adelaide and Canberra’s housing markets, with the former expecting a 3 per cent to 5 per cent rise in unit prices and the latter tracking an uplift of 0 per cent to 3 per cent for units.

A slower recovery is expected for Melbourne, with house prices expected to lift 3 per cent to 5 per cent in 2021 and no increase for unit values.

Mr Godber agreed that regional residential markets would be another standout performer in 2021, underlining the shift in demand for more affordable lifestyles.

The call comes in the wake of Westpac this week predicting a sharp 20 per cent jump in Australian property prices between now and 2023, with the bank also seeing Perth as a leader before it is overhauled by the three eastern capitals — Sydney, Melbourne, and Brisbane — in 2022 as the end of the pandemic allows international borders to reopen.