Price of houses stabilises

Broome house prices have stabilised, with positive growth recorded over the past 12 months.

Figures released by the Real Estate Institute of WA last week showed there was a 1.5 per cent increase in median house prices in the January to March quarter.

Over the past year, there has been a slight upward swing of 0.7 per cent, but the figures are 1.2 per cent down on what they were during the boom period five years ago when there was not enough affordable land to meet building demand.

Broome real estate agents said the figures were encouraging and predicted steady growth into the future, adding they felt the James Price Point announcement would have little effect on prices.

House sales in the Broome urban area in the March quarter reached 113, with a median sales price of $675,000.

The same number of properties were sold in Karratha over the same period, but for a median price of $790,000, while 189 sold in Port Hedland for a median price of $799,000.

Australian Property Monitors, which offers who offer a property price information service, indicated the median price of units in Broome had fallen in the 12 months to this January 2013.Broome Real Estate principal Allan Griffiths said unit prices had fallen by, but said the drop was less severe than the APM figures showed, at about $50,000 to $60,000.

“This is because there is more availability of land through big new releases like Broome North, which has zoning for group housing. Previously, there was a very limited supply of group dwelling sites where units could be built,” he said.

“The land value per unit dwelling has come down from an average $120,000 to about $80,000. If you bought a 10-unit site two-and-a-half years ago it would cost about $1.2 million to buy the land. Today it is costing about $800,000 or less.”

Mr Griffiths said speculation on industrial development, including the aborted James Price Point gas hub, and what impact they could have on the property market were no longer a factor.

“The market is now back to its previous consistent growth pattern,” he said.

“In other words, the spike has gone out of the market and we are expecting consistent future growth.”

Hutchinson Real Estate owner Tony Hutchinson predicted the market would continue its steady growth pattern.

“My feeling is the decision by Woodside to withdraw from JPP will have little or no impact on the market, as most informed purchasers were aware the development was unlikely to proceed,” he said.

Median house prices in Derby have also recorded positive growth of 1.9 per cent over the past 12 months.

Ray White Derby’s selling principal Tamyla Strahan was not surprised.

“Things are on the up in Derby, it is certainly a positive place to invest,” she said.

“Rents are nice and steady and the area is flourishing. “Real estate is an industry that has progressed in the town in recent times, with lots of new homes.”

REIWA president David Airey said Broome’s median asking rent continued to be a stable $650 a week, after a jump in the June 2012 quarter last year.

“There is some variability in the house and multi-residential (units/apartments/ villas) rents that compose the overall figure,” he said.

The latest median house rent is down 1.5 per cent for the quarter to $750, but up 7 per cent for the year. In the multi-residential sector, the median rent increased 6.3 percent to $525 per week in the quarter, but is down 0.8 percent across the year.

A 36 per cent downward trend in property available for lease from a high in November 2012 reflects a 47 per cent increase in properties leased in the March quarter.

“Whether the tightening in supply will put upward pressure on rents remains to be seen,” Mr Airey said.