Some stand-out in patchy market
Perth’s patchy apartment market is experiencing some outstanding results — but only where the alchemy of design and location are casting a spell.
Urbis economics and market research director David Cresp said Perth’s top three apartment projects notched up sales of 33, 20 and 18 respectively in the third quarter.
Despite this, Mr Cresp said even with strong pre-sales some developers had found themselves at the mercy of banks wary about apartments.
“Yes, it’s a tough market, but if you get the right product, there’s a market there,” Mr Cresp said, adding that at the end of the third quarter, Blackburne Property Group had sold 83 per cent of its Essence at Claremont on the Park. Mirvac’s Latitude at Leighton Beach was also 83 per cent sold. Stirling Capital’s Cirque in Applecross was 80 per cent sold.
Burgess Rawson director Chris Tonich, who is head of Burgess Rawson’s WA residential operations, said the tide was starting to turn for off-theplan apartment sales, which had suffered the double whammy of slowing population growth and a bank finance crackdown on investors.
Anecdotally near-city projects with strong owner-occupier appeal, particularly those with three-bedrooms, were selling well. Other projects with a high proportion of twobedroom apartments — the traditional staple of apartment projects — were struggling with pre-sales.
However, Mr Tonich said apartment investors were starting to re-emerge with interest from as far away as Sydney and Melbourne, where buyers were likely to have to pay at least $750,000 for a twobedroom city-fringe apartment, compared with $500,000 in Perth.
“That’s not to suggest that they (young Sydney and Melbourne professionals with transferable job skills) will become a significant proportion of the buyer market for Perth apartments but . . . it does show just how well the Perth market stacks up nationally,” he said, adding that Perth would likely experience an under-supply of apartments in a couple of years.
Mr Tonich said Real Estate Institute of Australia data had found the median unit price had trebled in all major capital cities over the past two decades. In Perth in the past 20 years that rise had been greater than the rise in house prices.
An artist’s impression of Cirque Apartments in Mount Pleasant.