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Melbourne saw a record number of new listings in July, with the average number of days a home is on the market for 39 days in Melbourne and 10 days in Perth, according to the latest Domain data released on Monday.
Chris Christofi, chief executive of Melbourne property investment company Reventon, said the north-west city of Melton offered affordable real estate, had a fast-growing population and was in the process of implementing a $1 billion hospital project and a $2 billion business park.
“While many are moving away from Victoria, we see opportunity,” he said. “Melbourne’s strong job opportunities and high population growth suggest a return to this market is imminent.”
Ray White Group chief economist Nerida Conisbee said while strong population growth and very low vacancy rates were driving factors, the biggest reason for the lack of new supply in Perth was construction costs.
She said construction costs in WA had re-accelerated to pandemic levels, rising 18.9 per cent in the 12 months to June and now far exceeded the cost of existing homes.
Labor shortages remain a major factor, and rising wages year after year still make it difficult to reduce costs.
Australian Bureau of Statistics statistics single out the lack of finishing jobs, which is also being blamed for low productivity due to high union activity, which is currently the subject of a Senate inquiry.
“We have clearly seen how much construction costs have risen, resulting in fewer homes being built and prices of existing properties increasing,” Conisbee said.
“Perth has seen the highest house price growth in Australia, up more than 25 per cent over the past 12 months.”
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