Monthly hours worked
This week’s real estate figures have proven very consistent with recent trends and averages. Perth recorded 882 sales for the week, which is almost exactly our 3-month average of 884 weekly sales. The 14% increase in sales was basically driven by a 16% increase in house sales. Listings remained steady again this week with 9026 properties for sale. The far right hand side of the graph below shows the upward trend in listings has flattened. Over the past six weeks, Perth has recorded consecutive weekly listings of 9017, 9118, 9212, 9054, 9016 and 9026, demonstrating a real consistency.
Perth property prices picked back up this week with Perth recording nearly a 0.3% increase. If listings and sales continue to remain consistent then Perth should demonstrate stronger price growth than the previous couple of months illustrated by the blue bars in the graph below. It does not look like Perth will meet the required average for an annual 20% price growth (the red line in the graph below). Most forecasts, including REIWA, are predicting a 15% price growth which is almost precisely the growth our graph is predicting. After the past 5 years, this is a welcome turnaround.
Our newsletters generally focus on interest rates, population growth and employment because these factors have the largest bearing on real estate prices. WA’s May employment figures were positive and a nice rebound after fairly lacklustre results in April (partially due to coronavirus lockdowns). Our preferred measure of employment is monthly hours worked and WA recorded a 1.5% increase in May with the graph below illustrating the rebound from April.
Overall, the ABS results showed WA has the lowest unemployment rate compared to the other states. WA’s unemployment dropped by 0.3% to 4.7%. With the current iron ore price of US$213 per tonne underpinning the WA economy and no overseas migration, you would expect the unemployment rate to fall further. However, all the states performed positively indicating just how well Australia’s economy has rebounded. Australia’s unemployment rate of 5.1% is equal to the unemployment rate back in February 2020, just prior to the coronavirus recession.