From The Desk Of Our CEO - February 2021

2021 has begun and on a positive note with interest in real estate being it’s highest for a number of years. We are regularly seeing properties sold and the vacancy rate is the lowest we have seen for a long long time. In March we will see the lifting of some of the restrictions which will impact the market. The big one being landlords allowed to review rents after the restrictions the State Government had in place not allowing increases and, also restricting the ability of the landlord to evict tenants under certain circumstances. So, come the end of March, we could see an upward trend on rents and movement of tenants who have been abusing the system.

Last year was a tough one for many but we did see a turning of the tide in the second half of the year which did catch many by surprise. Personally I wasn’t surprised our market conditions had been supressed for some time and it had to break at some stage. Western Australia’s economy has turned the corner during the year and our isolation gave us benefits we would not have considered before in fact many had seen it as a negative e.g like we never get the big concerts etc. Covid, although has affected the world, at times if you hadn’t seen the news here in Western Australia you wouldn’t know anything was happening. We are the lucky country but by far we are the luckiest State. The mining industry has grown again and will continue to be a big part of our economic activity for years to come with many new projects opening over the next couple of years.

We have seen our employment rate go from one of the worst to one of the best in the country. Confidence is everything in driving an economy and this plus the combination of the lowest lending rates that I’ve seen in my lifetime, has restarted the rush for real estate. A good friend said to me that people aren’t travelling as much or simply can’t so they’ve got to spend their money on something. Maybe he is right, but I think the new focus on where we live and whether you can afford to has become the new conversation again in the last twelve months. Rents will go up and the conversion will grow because many will compare the affordability of renting to owning. We will see equity growth in properties as competition increases for buying property and supply demand will again have a strong influence as it always does in a more buoyant market.

We are already seeing steady growth in pricing and we have seen many of the properties that had been on the market for a long time now sold. These are all healthy signs within an economy and the end of March may be a crossroad for some businesses as the support for via job keeper etc fade. No doubt there are still industries that will struggle as Covid still influences the world, but there are also new opportunities that arrive and as we have seen with the stock market, things continue to happen. One door shuts another one opens has, and will be, the case for some but as I’ve mentioned opportunities do arrive with change which we have witnessed in the last six months.

So at this stage it looks like we will continue to see steady improvement in market conditions and for those thinking of selling, the probability of sale is excellent. For landlords, we will see a review on rents but it will vary from property to property and location. For renters, you will be seeing increases in most areas so might be best to get your leases renewed quickly now. For buyers. time for action.  You won’t have the time to procrastinate as you have been able to do in the past. Do your homework before you go into the market, get your finance organised and talk to your broker earlier rather than later. There are some amazing finance deals out there which present new opportunities for everyone to help their businesses or simply reduce their current overheads.

2021/2022 looks very promising and not a time to sit on the fence. Decisive people will be the play makers and hopefully you will be one of them. All the best and if any of our offices or staff can be of any help to you, please let us know to take advantage of all our services from sales to property management, finance or settlements.

– Written by Milton Rendell, CEO – Real Estate Plus Group