If the Size is Right

Cast your mind back thirty years to 1990 when WA’s population was at 1.613 million people. Nowadays, we’re at 2.72 million, a not insignificant 68.6 per cent increase.

With such growth, one would reasonably expect the creation of new suburbs (think Alkimos, Bertram, Piara Waters, Haynes, Secret Harbour to name a few) and plenty more homes built not only in these emerging regions but more infill developments in established metro suburbs, to significantly add to Perth’s overall housing stock. There are fewer of us living in the same home nowadays too but even if this had stayed constant, it’s reasonable to assume we’ve got about another million homes to choose from.

It is therefore astonishing that in 1990 there were 37,444 sales recorded across WA. In 2019, there was 38,405. In 2018 there was only 40,957. Up until Perth’s property market recovery began in late 2019, despite our significantly larger population, the amount of sales activity has been below the ten year average of 52,002. For interest, WA recorded 88,791 transactions in 2005, the highest volume of sales over the past thirty years.

Land sales were hit hardest with only 5,685 vacant lots sold in 2019, less than half the previous ten year annual average of 11,923. Government lead home buyer stimuli in response to the COVID-19 emergency saw a 268 percent increase in land sales in 2020.

Established houses and apartment sales also fell away in the period from 2015 to 2019 but are now surging back despite moderate investor activity.

The market recovery is coming from the mid to higher priced property bracket as opposed to the more affordable end (such as that found in the outer suburbs) of the market.

Real Estate multi-national, Knight Frank, reported buyer behaviours around “rightsizing”. Apparently, buyers no longer “downsize”, they “rightsize” because it is becoming more common that the size and proportion of the accommodation in demand from downsizers is comparable to the larger family sized homes they’re typically leaving.

According to the report, rightsizers come from all demographics, not just cashed-up baby boomers and retirees and they are demanding smaller or no yards, good security, proximity to shopping and entertainment hubs and large living areas.

These rightsizers are looking for generous apartments in neighbourhoods where they already live. Knight Frank also found that the largest growth in three or more bedroom apartment demand is coming from Perth’s medium density projects up from 27 to 50 per cent of all new developments.

The way we want to live is changing. Demand for high quality, low maintenance, sustainably built, large homes on small lots or part of a mid-rise apartment group is increasing at the expense of bland, single level detached housing in the far edges of our cities.