Lower prices drive WA first time buyers on to the housing ladder

Transcription

1 MEDIA RELEASE Embarged t EST 05 December 2017 Lwer prices drive WA first time buyers n t the husing ladder Western Australia s first time buyers are injecting life int the state s prperty market, fueled by a drp in prices and the attractin f buying rather than renting. A new natinal reprt frm Bankwest reveals there are mre first time buyers (FTBs) as a prprtin f ttal buyers in WA than anywhere else in the cuntry. The 2017 Bankwest First Time Buyers Reprt shws WA FTBs made 21.7% f all purchases in the year t June 2017 the highest prprtin in the cuntry. Additinally, mre recent ABS data (which falls ut f the reprt s catchment perid) shws further grwth f 5.1% in the three mnths t Aug 2017 making a ttal f 15,849 first time purchases in the year t Aug On tp f this WA s FTBs are having t less time t get their ft n the husing ladder the nly mainland state t experience such a decrease. Accrding t the reprt it takes the average WA FTB 3.6 years t the necessary $94,651 fr a 20%, dwn frm 3.8 years last year. Bankwest General Manager Persnal & Small Business Banking, Dnna Dalby said WA s first time buyers are taking advantage f a number f factrs at play. The main reasn fr this shrter savings time is the fact that prices declined by 4.5% in the state, the largest decline natinwide. Even thugh wages nly grew by 1.4% during the same perid the effect is tangible, she added. The drp in prices has als had a knck-n effect n hw much peple in WA are having t brrw t buy their first hme. Western Australia was the nly state in mainland Australia t see the average lan size fr FTB cuples decline (by 4.2%) in the year t June Accrding t the reprt Perth remains ne f Australia s mst accessible capital cities fr FTBs, taking the average WA FTB cuple just 3.9 years t the $103,046 required n their first (three mnths less than in 2016 (4.2 years) and ne whle year belw the capital city average f 4.9 years). Perth and Darwin as cities buck the natinal trend, being the tw places where the saving times fr first time buyers has drpped year n year. Perth s prices have drpped by 4.3% which means the saving time t get the 20% f $103,046 (dwn $4,627 frm 2016) has drpped by three mnths t 3.9 years, said Dnna. The reprt als shws that Perth FTB cuples culd d well t cnsider pting fr a unit rather than a as a first hme. The average saving time fr a unit acrss Australia is 4.2 years, 5 mnths less than the saving time fr a. In Perth the saving time fr a unit is 3.2 years, dwn frm 3.5 years in 2016, the biggest drp f any city in the cuntry. On a state level it nw takes just 3.1 years fr a WA FTB cuple t a $80,283 n their first unit, three

2 mnths less than in 2016, a reductin driven by unit prices declining by 7.4% in WA in the year t June Everyne dreams f having their wn but medium and high density husing is n the increase acrss the cuntry and can ffer a nticeably quicker rute t hme wnership than aiming at a purchase, said Dnna. And while units can ffer a quicker rute t a first hme, thse in n hurry culd lk t try t buy in Perth s Peppermint Grve, the lcal gvernment area (LGA) with the lngest savings time in the whle natin. The salubrius suburb takes this unenviable title with a saving time f 21.2 years t the $672,944 need t put dwn a (dwn frm 21.7 years a year ag). At the ther end f the scale the LGA f Dundas in suth eastern WA is the area with the shrtest saving time just 0.7 years are needed t the necessary 20 per cent f $16,346. Dnna said the ninth annual First Time Buyers Reprt had been prduced as part f Bankwest s nging cmmitment t ffer insights n ecnmic data, trends and issues f value t its custmers, businesses, cmmunities and plicy makers. Bankwest has been supprting the prsperity f custmers, businesses, cmmunities and the ecnmy fr ver 122 years and we ll cntinue t d s in this fast changing wrld. We ffer a cnstructive vice n the ecnmy with insights n ecnmic data, trends and issues which matter t ur custmers, businesses, cmmunities and plicy makers. I hpe this annual reprt, which prvides a snapsht f the cuntry s husing market in 2017, demnstrates this, she said. Key WA and natinal findings f the Bankwest First Time Buyers Reprt 2017: Western Australia FTB cuples in WA have t fr 3.6 years t fr a 20% n a median priced, three mnths less than in 2016 and ne whle year belw the natinal average f 4.6 years. FTB cuples in Perth have t fr 3.9 years t a $103,046 n a median priced, three mnths less than in 2016 and ne year less than the capital city average f 4.9 years. This makes Perth the third mst accessible capital city fr FTBs natinwide behind Hbart and Darwin. Saving time fr Western Australian units and s declined by three mnths, the largest declines fr units and s respectively f all Australian states, retaining WA s reputatin as ne f the mst accessible states fr FTBs. Mre than fur fifths f Perth s LGAs (82.8% r 24 ut f 29) experienced a decline in saving time in the year t June 2017, the mst f any capital city natinwide.

3 The Gldfields and the Pilbara accunt fr seven f the tp 10 mst accessible LGAs acrss Western Australia. Within WA, 16.0% (12 ut f 75) f LGAs require less than tw years t a, behind nly Queensland and Suth Australia. Saving times in WA s nrthern Pilbara regin have decreased significantly in the five years t June The fur Pilbara regins featuring in the tp 10 list f LGAs with the lwest saving time include the East Pilbara (1.0 year vs 3.8 years in 2012), Ashburtn (1.1 years vs 2.6 years in 2012), Prt Hedland (1.3 years vs 4.4 years in 2012) and Karratha (1.6 years vs 4.3 years in 2012). Huse prices in the regin have declined by an average f 64.0% in the five years t June 2017, giving Pilbara FTB cuples a greater chance f hpping n the prperty ladder. WA is hme t fur f the 10 mst accessible LGAs fr FTBs natinwide. Excluding Cttesle, all f WA s tp 10 least accessible LGAs experienced a year-n-year decline in saving time. This can be attributed t an average 3.7% fall in prices in these 10 areas. Natinal 94,135 first hmes were purchased in the year t Aug 2017, a 5.6% YY increase and the highest figure since June First time purchases accunted fr 14.3% f all purchases in the year t Aug 2017, up frm 13.3% in FTB cuples will need mre time t in 2017 in 85.5% (360 f 421) f LGAs acrss the natin. Natinwide, nly 13.5% (57 ut f 421) f LGAs require less than tw years t a 20% n a median priced, dwn frm 18.1% (76 ut f 421) in This is largely due t an additinal 10 NSW LGAs mving abve the tw years t threshld in the year t June 2017.

4 Tp 10 Western Australian LGAs where it takes the mst time fr FTB cuples t a LGA Name 2017) 2016) 2012) Regin State Savings needed fr 20% $s Peppermint Grve Perth WA $672,944 Cttesle Perth WA $375,974 Nedlands Perth WA $331,032 Msman Park Perth WA $259,941 East Fremantle Perth WA $231,578 Cambridge Perth WA $248,705 Claremnt Perth WA $247,732 Subiac Perth WA $223,495 Suth Perth Perth WA $169,102 Vincent Perth WA $176,588 (*)Saving time fr 2017 has been mdelled using CreLgic Valuatin Mdel, 2016 and 2012 saving times mdelled using Residex Valuatin Mdel Tp 10 Western Australian LGAs where it takes the least time fr FTB cuples t a LGA Name 2016) 2012) Regin State Savings needed fr 20% $s Dundas Gldfields WA $16,346 Clgardie Gldfields WA $24,676 East Pilbara Pilbara WA $43,371 Ashburtn Pilbara WA $57,500 Prt Hedland Pilbara WA $51,768 Merredin Wheat belt WA $33,865 Karratha Pilbara WA $62,333 Cllie Suth West WA $42,979 Ravensthrpe Gldfields WA $52,906 Wagin Wheat belt WA $38,877 (*)Saving time fr 2017 has been mdelled using CreLgic Valuatin Mdel, 2016 and 2012 saving times mdelled using Residex Valuatin Mdel

5 Fr mre infrmatin cntact: Russell Ye Bankwest Senir Manager, Media & Cmmunicatins Abut Bankwest Bankwest prvides persnal and business banking slutins fr mre than 1.1 millin retail and business custmers acrss Australia. Bankwest custmers enjy access t an extensive netwrk f stres and business centres, direct and third party distributin channels, agencies and electrnic banking facilities, as well as 24-hur telephne and internet banking. Bankwest is a divisin f the Cmmnwealth Bank f Australia. Abut the reprt The ninth annual Bankwest First Time Buyer Reprt tracks the time it wuld take first time buyers t a fr a hme in 421 lcal gvernment areas (LGAs) acrss Australia in the five years t June The reprt quantifies hw lng it wuld take a first time buyer t a 20% based n lcal incmes, lcal prices and assistance frm the First Hme Owners Grant, where available, by state. The insights in the reprt have been derived by CreData based n data frm CreLgic, Australian Bureau f Statistics (ABS), the 2011 and 2016 Census, and the Reserve Bank f Australia. Fr mre infrmatin n the data surces and methdlgy, please see the Editr s Ntes in the full reprt. Depsit savings times have been calculated n the basis f a first time buyer cuple setting aside 20% f their cmbined pre-tax incme annually. The calculatin assumes the savings are ed int an nline savings accunt each mnth and earn interest n this basis.