By Kim Macdonald
A prominent property valuer says WA real estate will soon hit rock bottom before modest growth begins in summer.
Valuer Brendon Ptolomey said the 15 per cent drop in listings in the three months to August, taking the number below 16,000, was the first "ray of sunshine" for the sector in a long time.
Mr Ptolomey, managing director of Herron Todd White, said the reduced stock signalled realism had finally prevailed, with sellers finally accepting reduced prices. He said this would help to further offload stock and steady prices.
Mr Ptolomey said modest price growth in some suburbs would start this summer when stock levels were expected to drop back to a more standard pool of 12,000 to 13,000 homes. "We are looking at finding the bottom of the market this quarter and, as we move into spring and summer, we should see some consolidation of prices and some modest growth," he said. "If you have spare cash, this is the time to be looking around."
Mr Ptolomey forecast that some pockets of Perth, mostly in fringe suburbs, faced a "long journey back" to values attained during the property boom five years ago. It comes amid new figures from the Supreme Court showing there were 357 home repossessions in the June quarter - or nearly four a day. It was the highest level since the March quarter in 2009 and believed to be the second highest on record.
In the March quarter this year, there was 321 repossessions and in three months to December last year, there were only 258. Mr Ptolomey said the increase was mainly because of finance companies coming to accept that there would not be quick return to 2007 values and no way to avoid capital losses in the medium term. He said the realistic attitude was evident in all sectors of the market.
"Vendors are getting tired of waiting for that magic offer to come along or realise that if the magic offer does happen, the person making it isn't going to get finance anyway." he said. "We expect the median house price to continue to drop away in the next couple of quarters and then find a base and bounce back early next year."
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