Home

Median price not a tell-all indicator

Headshot of Erick Lopez
Erick LopezThe West Australian
Peppermint Grove was among the suburbs recording price slumps.
Camera IconPeppermint Grove was among the suburbs recording price slumps. Credit: ClaraNila/Getty Images/iStockphoto.

While property prices are largely reported to be on the rise throughout Perth and wider Western Australia, REIWA data for the 2021 financial year has revealed not all suburbs have been so lucky.

Star performers over the 12-month period included Ascot and Henley Brook, where the median price leapt more than 40 per cent and 50 per cent respectively, while on the opposite end of the spectrum, Herne Hill (-28.8 per cent) and Forrestdale (-28.3 per cent) saw the biggest median price drops.

The Agency Perth Property Partner Nicola Stacey said there were a range of factors at play in Forrestdale which could be deceiving for prospective buyers delving into the numbers

“Some things to consider when you are looking at average prices in a suburb like Forrestdale is that in the past it has been a suburb which was predominantly rural,” she said.

Get in front of tomorrow's news for FREE

Journalism for the curious Australian across politics, business, culture and opinion.

READ NOW

“Now there are homes sitting on blocks ranging from 10,000sqm, through to 1000-2000sqm, right down to 375sqm residential blocks.

“So it just depends on what has sold in the 12 months that is reflected in the data.”

Ms Stacey said the main reason for the drop in Forrestdale’s price growth was the residential subdivision of smaller blocks, which she said made for an anomaly in the figures.

“You need to look at the residential subdivision by itself and look at the rural blocks by themselves to get a true reading of growth,” she said.

“There was a similar scenario with Banjup when the Calleya subdivision was realised.

“Calleya is now its own suburb called Treeby, and Banjup and Treeby are now two separate suburbs, so the figures will correct themselves.”

Also known for large land releases in recent years, Wellard and Eglinton saw impressive median price growth rates of 19.2 per cent and 26.4 per cent respectively over the period.

However, many of the top suburbs which saw decreases in median price growth were similarly situated on the fringes of Perth with a blend of rural and residential properties.

Surprisingly, inner-city hub East Perth followed the same downward trend, recording a 13 per cent price decrease over the period.

Ray White City Residential Director Brent Compton was surprised by the numbers, but said 2020 was not a good indicator of the suburb’s performance and 2021 sales had already drastically improved.

“I would say last financial year had four or five months of complete uncertainty in 2020, so there’s three or four months of inactivity,” he said.

“I would have a guess that if you wanted to take a 12-month rate between the start of this year and the end of this year, I’d say the figures would all be up.”

East Perth has a unique property spread, with almost 90 per cent of properties being flats, units or apartments. Villas, duplexes and townhouses make up eight per cent, while houses fall just short of three per cent.

Mr Compton said now was a great time to jump on very fair prices in East Perth, within close distance to the Perth CBD and Swan River.

“The prices are actually extremely reasonable compared to what you can get for the same sort of money in other capital cities,” he said.

The shortage of building materials and rising fuel prices will swing buyers back to East Perth, according to Mr Compton.

“The developers that are building now, they have to consider their prices again because the cost of builds have just gone up another 10 or 20 per cent,” he said. “I believe the slowing down of supply will hold East Perth in good stead for good, consistent growth over the next three to five years.”

Peppermint Grove was another well-established inner-city suburb that saw a decrease in price (10 per cent).

Echoing Ms Stacey, Mr Compton said the numbers were heavily dependent on which homes were sold within the time of the data being recorded.

Reiwa data.
Camera IconReiwa data. Credit: REIWA.

Get the latest news from thewest.com.au in your inbox.

Sign up for our emails