20 April 2012
New data from the Real Estate Institute of Western Australia show that overall sales in the March quarter reached its highest level since March 2010, just after the Rudd government's FHOG Boost- ended.
REIWA President, David Airey, also said the latest WA data on First Home Owner Grants (FHOG) from the Office of State Revenue show that first time buyers have been a key part of this recent market recovery.
"The latest FHOG data on grants paid for established dwellings surged in the March quarter reaching 2,933, just short of the quarterly average since the grant was first introduced 12 years ago.- The number of grants paid for new dwellings in the March quarter turned down marginally to 938."
Mr Airey said 8 out of 10 first time buyers purchased an existing dwelling, which was good news for trade-up buyers who needed the opportunity to sell their existing home before being able to move on.
"The strong activity from first home buyers has been a tonic to the market and we can see from current figures that as a result of this activity, trade-up purchases also improved during the March quarter for properties above the current median of $465,000.-
"Despite the surge in grants paid, REIWA expects the proportion of first home buyers to the overall market to decline over time because the increased level of trade-up activity was contributing to higher turnover and the market was becoming more balanced," Mr Airey said.
"This return to a more balanced market has seen the overall median house price remain stable between the quarters," Mr Airey said.
Current FHOG application data indicate that the level of first home buyer activity may have reached its peak, with applications for established property levelling out at 3,054 in the March quarter, just above the 2,968 recorded in the December quarter.
At the same time, applications for new dwelling grants have risen for the second quarter to 1,045 as the influence of recent house and land package marketing campaigns flow into the data.
According to the OSR, in March the median purchase price for a first home was $420,000 in the city and $327,000 in the regions.