Capes house price boom set to continue

The Real Estate Institute of WA is confident Capes house prices are going to keep rising into next year. Margaret River, Busselton and Yalyalup were hot spots for median price rises. REIWA president Joe White told the Times growth continued across the Capes, albeit at a slower pace. “Margaret River has been a consistent performer post-COVID-19,” the Dunsborough-based realtor said. “While some towns are showing a small decline in median house prices recently, we must remember that they have seen strong growth in the past few years.” The Times last month reported the end of the Capes real estate boom that kicked off during the pandemic but the decline in listings was helping keep prices buoyant. West Busselton and Margaret River posted the strongest jump in median house prices in the six months to June, up 9.4 per cent and 8.3 per cent respectively. But other localities also showed strong growth, with Busselton up 7.2 per cent and Yalyalup 6.8 per cent. The median Margaret River house price was now $650,000 — a $50,000 jump since December. West Busselton grew a similar degree to $612,000, with Busselton central not far behind at $600,000, up from $560,000. Factors now in the Capes region’s favour included delays in the building industry and lifestyle attraction for mining workers and interstate buyers. “With so many FIFO workers in Margaret River, Dunsborough and surrounding areas, the fortunes of the housing market are now inextricably linked to the resources sector,” Mr White said. But interest rate rises were making buyers more cautious. “They are finding out what they can borrow, factoring in the prospect of more interest rate increases and are buying the right property at the right price for them,” he said. “This is keeping price growth at reasonable levels.” Another growth factor was people increasingly choosing the Capes as a base for new businesses while still within a commute to Perth when needed. “Lifestyle continues to be a key driver for the South West region and this is expected to continue,” Mr White said. “Housing is generally cheaper than Perth, particularly when you move a bit further from the beachfront.” But demand versus limited supply meant renters would continue to struggle into next year. “Prices in the rental market will continue to grow,” Mr White told the Times. “Fixed-term leases signed 12 months ago that come up for renewal will see rent prices increases, although many property owners only making moderate increases.” Mr White said the fortunes of the resource centre were one to watch to get the best indicator of the local housing market, while bank interest and unemployment rates were additional factors.