UDIA WA PROPERTY MARKET STATISTICS

UDIA WA PROPERTY MARKET STATISTICS APRIL 218 1

IN THIS ISSUE KEY TRENDS INDUSTRY UPDATE ECONOMY RESIDENTIAL LAND DEVELOPMENT RESIDENTIAL PROPERTY SETTLEMENTS RESIDENTIAL PROPERTY MARKET RESIDENTIAL CONSTRUCTION SECTOR 6 7 8 9 2

KEY TRENDS ECONOMY Current Figure M/Q Change M/Q Rolling Av. YOY Change Official Cash Rate Target (RBA) 1.% (Apr) % (M) 1.% (M).% Discounted Variable Mortgage Rate (RBA).% (Apr) bps (M).% (M) - bps Estimated Resident Population - WA 2,87,1m (Sep).% (Q) 2,81,1m (Q).9% Unemployment Rate - WA (Seasonally Adj.) 7. (Mar) 78 bps (M) 6.8 (M) 9 bps Retail Turnover - WA (Original) 2.81 b (Mar) 12.9% (M) 2.69b (M).6% Consumer Price Index - Greater Perth 11. (Mar).1% (Q) 19.8 (Q).9% Wage Price Index - WA 128.1 (Dec).% (Q) 127.6 (Q) 1.% RESIDENTIAL LAND DEVELOPMENT SECTOR Current Figure M/Q Change M/Q Rolling Av. YOY Change Lot Sales (UDIA Land Snapshot ) 21 (Apr 218) -.6% (M) 27 (M) -7.% RESIDENTIAL CONSTRUCTION SECTOR Current Figure M/Q Change M/Q Rolling Av. YOY Change Dwelling Approvals - WA (Original) 1,17 (Mar) -.% (M) 1,2 (M) -2.% Private Sector House Approvals - WA (Original) 892 (Mar) -1.% (M) 9 (M) -1.% New Dwelling Loans Owner-Occupation - WA (Original),7 (Feb) 2.8% (M),8 (M) -11.% Dwelling Construction Starts - WA (Original), (Dec) 11.1% (Q),98 (Q) 12.2% House Approvals - Greater Perth (Original) 76 (Mar) -11.2% (M) 812 (M) -.% Multi-Unit Approvals - Greater Perth (Original) 21 (Mar) 8.% (M) 228 (M) -28.2% RESIDENTIAL PROPERTY MARKET Current Figure M/Q Change M/Q Rolling Av. YOY Change Median House Price - Perth (Landgate/REIWA) 1, (Mar) -1.9% (Q) 1, (Q) -1.2% House Sales - Perth (Landgate/REIWA),97 (Mar) -11.2% (Q), (Q) -19.9% Unit Sales - Perth (Landgate/REIWA) 1,187 (Mar) -9.9% (Q) 1,26 (Q) -19.% House and Unit Listings - Perth (REIWA) 1,1 (Mar) 1.2% (Q) 1,8 (Q) -2.9% Dwelling Loans Owner-Occupation - WA (Original), (Feb) -.2% (M),97 (M) -11.7% Established Dwelling Loans Owner-Occupation - WA (Original) 2,78 (Feb).7% (M) 2,17 (M) -9.6% FHOG Applications - WA (Original) 12 (Apr).% (M) (M) -8.1% Investment Housing Loans - WA (Original) 2.8m (Feb) -.2% (M) 86.m (M) -1.% REIWA Average Selling Days - Perth 7 (Mar) 11.1% (Q) 68.7 (Q) -2.8% Residential Rental Market Current Figure M/Q Change M/Q Rolling Av. YOY Change REIWA Median Rent - Perth 6 (Mar) 1.% (Q) (Q) -2.7% REIWA Vacancy Rate - Perth.1% (Mar) - bps (Q).8% (Q) -1 bps

UDIA WA INDUSTRY UPDATE CHRIS GREEN Director Policy & Research UDIA WA The recent release of both the Federal and State budgets represent both positive and potentially negative outcomes for the recovery of the property market in Western Australia, which finally appears to be heading in the right direction, according to a range of data, including the March edition of the UDIA Urban Development Index (UDI). The UDI results indicate that a slow and steady recovery in Perth s greenfield market is underway, e v i d e n c e d b y t h e s e c o n d consecutive quarter of rising demand, plus overall stability in the average price of new land. Lot supply has also picked up, with new estates and stages being brought to the market and projected twelve-month lot production increasing to its highest level in twelve months. This is a firm representation of an increase in developer confidence in the market moving forward. This confidence and optimism in WA s property market recovery and the broader economy is also reflected in the Chamber of Commerce and Industry s (CCI) Consumer Confidence survey (here), with the results for the March 218 quarter at a four-year high (since December 21), both in the medium-term and shortterm confidence. Furthermore, the CCI s Business Confidence survey (here) for the March 218 quarter displayed similar positivity, with the business confidence index at its highest level since 211 for short-term ( months) and medium-term (12 months) confidence. Additionally, the job market looks to be heating up, as job vacancies advertised online rose by 1% over the past year in WA, and 2% of businesses are looking to increase staff levels. Despite these positive signs, government policy can have a significant and potentially negative impact on this tentative recovery and it is important that the government take the right measures to foster current conditions. In the Federal Budget,.2 billion was allocated to WA, offering a welcome investment funding boost that will assist in the State Government s ambitious METRONET plan and other infrastructure initiatives. Unfortunately, the Federal Budget did lack a continued focus on improving housing affordability, particularly given that affordability measures in last year s budget were so welcomed. A greater leadership role is required of the Federal Government to show the way for the other levels of government on this issue, through cutting red tape and ensuring efficient and streamlined planning systems. Offering incentives for more streamlined processes through funding would also be welcome. These types of measures would go a long way toward addressing the underlying causes of a lack of housing affordability. The housing affordability initiatives included in the State Budget are a step in the right direction, in particular the METRONET Social and Affordable Housing and Jobs Package, and the announcement of eight high-density METRONET orientated developments that should promote more affordable housing and a more diverse range of housing in close proximity to essential services and facilities. Nevertheless, UDIA is concerned that some of the measures employed in the 218-19 State Budget will be detrimental to the recovery of the property market, such as the short-sighted increase in the foreign buyers surcharge. We were pleased that other property taxes including stamp duty and land tax rates were not increased, however UDIA s prebudget submission called for a comprehensive review of property tax regimes and an investigation into the establishment of a broad based land tax, which we still hope to see initiated. Indeed, although positive signs have been emerging recently, as demonstrated by the data contained in this month s Urban Intelligence Report, WA s property market remains fragile. In particular, the unemployment rate rose during March to sit at 7.%, 9bps above the rate last year. However, this headline does mask the more positive trends of an increase in the number of jobs over the past year and increasing state participation rate with the increase in the unemployment rate largely driven by an increasing population. Median rents also increased 1.% during the March quarter, driven by a falling rental vacancy rate down to.1% from 6.% a year ago. First home buyers continue to be an important market segment with FHOG applications up.% in April. UDIA will continue to monitor the emerging market trends closely and in particular looks forward to the upcoming release of the Housing Industry Forecasting Group mid-year update to provide an assessment of construction activity.

Retail Turnowver Growth (p.a) Year-on-year change in Index (calculated quarterly) Home Loan Rates (% p.a.) Employed Persons (,) Unemployment Rate (%) ECONOMY Key Points of Interest Western Australia s unemployment rate for March increased 78 basis points (bps) over the month to sit at 7.% (original terms, 6.9% seasonally adjusted), 9bps above the rate at the same time last year and 162bps above the national rate of.9%. In March, the number of employed persons in WA fell slightly by.1% to 1.8 million, an increase of 2.2% yearon-year (YoY). The state participation rate for WA increased 8bps over March to sit at 69.%, 1bps higher YoY and bps above the national rate of 6.8%. WA s consumer price index (CPI) for March increased bps quarter-on-quarter to 112.6, a.9% growth rate from the same time last year. This is the highest annual growth rate since the March 217 quarter (1.%). WA retail turnover for the March quarter increased.2% YoY to sit at 8.9 billion, and made up 1.7% of the national total (7. billion). In April the Australian dollar fell against the major currencies of the USA (.76 USD) and China (.79 Chinese Renminbi); while lifting against that of Europe (.62 European Euros; and falling against that of Britain (.9 British Pounds). 1 8 Labour Market, WA (ABS) 1 7 1 6 12 12 11 11 1 1 2 Mar-8 Mar-9 Mar-1 Mar-11 Mar-12 Mar-1 Mar-1 Mar-1 Mar-16 Mar-17 Mar-18 Employed Persons (Original) Unemployment Rate (Seas. Adj.) Unemployment Rate (Original) Source: ABS 622., T8 Mortgage Rates, Australia 9. Standard Variable 8. Discounted Variable 7. Three Year Fixed 6.... Apr-8 Apr-9 Apr-1 Apr-11 Apr-12 Apr-1 Apr-1 Apr-1 Apr-16 Apr-17 Apr-18 Source: RBA, F.7 Consumer Price Index (ABS)...1 Mar-8 Mar-9 Mar-1 Mar-11 Mar-12 Mar-1 Mar-1 Mar-1 Mar-16 Mar-17 Mar-18 -.1 -. CPI - Perth (Housing) YOY Change CPI - Perth (All Groups) YOY Change CPI - Australia (Housing) YOY Change CPI - Australia (All Groups) YOY Change Source: ABS 61, T 1, & 7..1 Retail Turnover (ABS).11.9.7...1 -.1 Mar-8 Mar-9 Mar-1 Mar-11 Mar-12 Mar-1 Mar-1 Mar-1 Mar-16 Mar-17 Mar-18 -. YoY WA (Original) YoY Australia (Original) YoY WA (Seas. Adj.) YoY Australia (Seas. Adj.) Source: ABS 81, T

RESIDENTIAL LAND DEVELOPMENT SECTOR Key Points of Interest 18 7 16 6 1 12 1 8 6 2 The median lot price for the month fell a slight 1.% MoM to 22,112, and remained steady from the same time last year with a.6% increase. 2 Total weekly lot sales Sales within all survey price categories fell across the board from the peak in the month previous. Combined sales 2, (and under) were down 1.1% MoM and.% year-on-year (YoY); combined sales 2,1-28, decreased 9.7% MoM and 7.2% YoY; while combined sales over 28, also fell 2.9% MoM and 8.% YoY. UDIA Land Snapshot Survey - Lot Sales 8 Weekly category lot sales In April, UDIA Land Snapshot survey recorded a.6% month-on-month (MoM) decrease in total sales, after reaching a 19 month peak in March. April s figures were also 7.% down from the same time last year. 1 Apr-1 2 Oct-1 Apr-1 Oct-1 Apr-1 Oct-1 Apr-16 Oct-16 Apr-17 Oct-17 2, or under Rolling 12 Month Average 2,1-28, Rolling 12 Month Average 28, plus Rolling 12 Month Average Total Sales Rolling 12 Month Average Apr-18 Source: UDIA Land Snapshot Survey Monthly vacant land settlements by metropolitan corridor for January, 218 (Landgate) Top five suburbs for vacant land settlements for the three months to January, 218 (Landgate) Monthly Vacant Land Settlements by Corridor TOP SUBURBS FOR VACANT LAND SETTLEMENTS Settlements Three months to 1 Jan Regions North-East Metro North-West Metro South-East Metro South-West Metro Peel Central Metro Settlements 6 8 26 1 27 6 Vacant Land Settlements/month Median Lot Size 87 79 8 87 9 Central North East North West South East Median Price Median Size 1 PIARA WATERS 7 287, 7. 2 WELLARD 29 192,8 8. ALKIMOS 29 197,. BYFORD 28 21, 9. AVELEY 21 216, 1. Greater Perth Corridor Vacant Lot Settlements South West Peel 2 1 Jul-16 Median lot price per month (thousands) Vacant Land Median Price 27, 279, 27, 26, 287, 69, Aug-16 Sep-16 Oct-16 Nov-16 Dec-16 Jan-17 Mar-17 Apr-17 May-17 Jun-17 Jul-17 Aug-17 Sep-17 Oct-17 Nov-17 Dec-17 Greater Perth Corridor Median Prices Central North East North West South East South West Peel 1 Median lot size/month Jul-16 6 Aug-16 Sep-16 Oct-16 Nov-16 Dec-16 Jan-17 Mar-17 Apr-17 May-17 Jun-17 Jul-17 North East North West South East Greater Perth Corridor Median Lot Size Central Aug-17 Sep-17 Oct-17 Nov-17 Dec-17 South West Peel 2 Jul-16 Aug-16 Sep-16 Oct-16 Nov-16 Dec-16 Jan-17 Mar-17 Apr-17 May-17 Jun-17 Jul-17 Aug-17 Sep-17 Oct-17 Nov-17 Dec-17 Note: Settlement figures on this page are based on Landgate data available at the time of publication and may not represent all settlements during the period. 6

RESIDENTIAL PROPERTY SETTLEMENTS Median Price/Settlements Greater Perth Median Price Detached and Non-Detached Dwellings: Greater Perth 8, 6, 6, 2,, 2 6, 1, Settlements Detached Houses,, 16 12 26, 1 2, Dec-17 Nov-17 Oct-17 Sep-17 Aug-17 Jul-17 Jun-17 May-17 Apr-17 Mar-17 Jan-17 Dec-16 Nov-16 Oct-16 Sep-16 2 16, Aug-16 18, Jul-16 Jun-16 Dec-17 Oct-17 Nov-17 Sep-17 Jul-17 Aug-17 Jun-17 Apr-17 May-17 Mar-17 Jan-17 Non-Detached Housing Pilbara Non-Detached Housing Mid West Non-Detached Housing Great Southern Non-Detached Housing Goldfields Esperance Non-Detached Housing Gascoyne Detached Housing Wheatbelt 6 2, May-16 Dec-16 Non-Detached Housing South West 8 22, Apr-16 Oct-16 Non-Detached Housing Wheatbelt 1 28, Mar-16 Nov-16 2 18 Median Price Non-Detached Dwellings Regional Dwelling Settlements February 18 2, Median Price Vacant Land Settlement Vacant Land First Home Buyer Grant Applications - new build Sep-16 Median Price Detached Houses Vacant Land Settlements, Median Price: Greater Perth and FHOG Applications Jul-16 - Dec-17 Oct-17 Nov-17 Sep-17 Jul-17 Aug-17 Jun-17 Apr-17 Median Price Detached Houses May-17 Mar-17 Jan-17 Dec-16 Oct-16 Nov-16 Sep-16 Jul-16 Aug-16 Jun-16 Apr-16 May-16, Mar-16 2, Aug-16 8, Jun-16 1, Apr-16, May-16 1, Mar-16 2, Detached Housing South West Detached Housing Pilbara Detached Housing Mid West Detached Housing Great Southern Detached Housing Goldfields Esperance Detached Housing Gascoyne Source: Landgate/UDIA/Treasury (WA) 2 6 8 1 12 1 16 Regional Land Settlements February 18 Vacant Land Wheatbelt Vacant Land South West Vacant Land Pilbara Vacant Land Mid West Vacant Land Great Southern Vacant Land Goldfields Esperance Vacant Land Gascoyne TOP SUBURBS FOR MEDIUM DENSITY SETTLEMENTS Settlements Three months to 1 Jan 1 1 Median Price Median Size 2 2 TOP SUBURBS FOR DETACHED HOUSING SETTLEMENTS Settlements Three months to 1 Jan Median Price Median Size 1 SCARBOROUGH 9 6, 186. 1 BALDIVIS 91,. 2 MAYLANDS 77 7, 1. 2 CANNING VALE 88, 67. INNALOO 72 67, 196. HALLS HEAD 66 9, 718. COMO 71 2, 116. THORNLIE 9 8, 72. EAST PERTH 67, 11. GOSNELLS 6 2, 766. Source: Landgate/UDIA Top suburbs for detached housing and medium density settlements over the three months to Jan 218. Note: Settlement figures on this page are based on Landgate data available at the time of publication and may not represent all settlements during the period. 7

RESIDENTIAL PROPERTY MARKET Key Points of Interest Purchase of new dwellings (WA) Refinancing of established dwellings (WA) Purchase of established dwellings (WA) 8 6 2 Feb-9 Feb-1 Feb-11 Feb-12 Feb-1 Feb-1 Feb-1 Source: ABS 69., T1a (Original Data) Dwelling Finance for Investment Housing (ABS) 16 WA Dwelling Finance (m/month) Included within the total owner-occupier housing finance commitments: commitments for the construction of dwellings fell 6.1% MoM and 9.6% YoY to 76; commitments for the purchase of new dwellings increased 16.% MoM and fell 6.% YoY to 191; and commitments for the purchase of established dwellings were up.1% MoM to,87, 9.9% lower than at the same time last year. Construction of dwellings (WA) Total housing finance commitments (WA) Feb-8 Total owner-occupier housing finance commitments for February increased 2.8% over the month to,7, 11.% lower than at the same time last year. 1 16 WA Dwelling Finance for Investment Housing WA Rolling month average AU Dwelling Finance (m/month) Dwellings financed by WA non-fhbs lifted.% MoM in February to,9, but were down 1.6% YoY. The average loan size for non-fhb, while falling.% over the month to,, increased 7.% from the same time last year. Owner Occupier Loan Commitments (monthly) The number of dwellings financed by WA first home buyers (FHB) increased 2.2% over February to 1,18, remaining steady from the same time last year. The FHB average loan size fell 1.% month-on-month (MoM) to,, 2.2% lower year-on-year (YoY). Owner Occupier Housing Finance, WA (ABS) 12 1 1 AU Dwelling Finance for Investment Housing 12 AU Rolling month average 12 1 1 8 6 8 6 2 Feb-8 Feb-9 Feb-1 Feb-11 Feb-12 Feb-1 Feb-1 Feb-1 Source: ABS 671., T1 & 2 (Original Data) Dwelling Finance, WA (ABS) Perth Metropolitan Quarterly Update 1 6 1 9 9 8 2 6 2 1 1 Median Price (quarterly) 7 7 6 2 2 2 Dwelling/Land Sales (Quarterly) 8 Home Loan Commitments Average Home Loan Amount (thousands) 1 1 1 Source: ABS 69., T9b (Original Data) 6 1% Perth Metropolitan Rent (REIWA) 2 Units Sold Land Sold Median House Price Median Unit Price Median Land Price Dec-17 Mar-18 Jun-17 Houses sold Sep-17 Dec-16 Mar-17 Jun-16 Sep-16 Non-FHB: Dwellings Financed Dec-1 FHB: Dwellings Financed Mar-16 Non-FHB: Average Loan Size Jun-1 FHB: Average Loan Size Sep-1 Dec-1 Mar-1 Feb-1 Jun-1 Feb-1 Sep-1 Feb-1 Dec-1 Feb-12 Mar-1 Feb-11 Jun-1 Feb-1 Sep-1 Feb-9 Mar-1 Feb-8 Source: REIWA Residential Property Listings, Perth Metro (REIWA) 18 % 2 1 % Quarterly variance - Median House Rent House and Unit Listings (Quarterly) Quarterly Variance & Vacancy Rate (%) Median House Rent (Quarterly) 16 1 12 1 8 6 2 Vacancy rate Mar-7 Median House Rent -% Mar-8 Mar-9 Mar-1 Mar-11 Mar-12 Mar-1 Mar-1 Mar-1 Mar-16 Mar-17 Source: REIWA Source: REIWA 8

RESIDENTIAL CONSTRUCTION SECTOR Key Points of Interest FHOG Applications & Payments for New Dwellings 1, WA dwelling completions for the December quarter fell 17.8% QoQ to,81, 9.9% lower YoY. House completions, which made up 76.2% of the total, also fell 12.% QoQ and.% YoY to sit at,18. WA building approvals for houses fell 9.9% month-on-month (MoM) in March to 9, 2.6% below the figure at the same time last year. Of this total, 8.9% were located in Greater Perth, which saw house approvals decrease 11.2% MoM and.% YoY to 76. Building approvals for dwellings (excluding houses) for WA increased.% in March to 2, a.% decrease from the year before. Approvals for dwellings (excluding houses) for Greater Perth also increased 8.% MoM and fell 9.2% YoY to 21. FHOG Paid for New Dwellings FHOG Paid Month Rolling Average FHOG Applications for New Dwellings FHOG Applications Month Rolling Average 1, Apr-8 2 Apr-12 Apr-1 Apr-1 Apr-1 Apr-16 Apr-17 Apr-18 2 1 1 Mar-28 Mar-21 WA Houses Mar-212 WA Other Dwellings Mar-21 Perth Houses Mar-216 Mar-218 Perth Other Dwellings Source: ABS 871., T & 1 Residential Construction (dwellings per quarter) Of this total: the value of new construction building jobs decreased.2% MoM and.% YoY to 17.2 million; and the value of building jobs for alterations and additions (including conversions) was also down 11.8% MoM and 1.6% YoY to 7.2 million. Apr-11 Building Approvals, WA & Greater Perth (ABS) 1 Apr-1 The value of new WA residential building jobs in March fell.% MoM to 6. million, 28.% lower than in March 217. Apr-9 Source: Treasury Building Approvals (dwellings/month) Over the December quarter,,211 dwellings were commenced in Western Australia, an increase of 1.8% from the previous quarter (QoQ) and 16.% higher than at the same time last year (YoY). Of this total, 6.% were houses. WA house commencements for December fell 9.9% MoM to,8, a decrease of 8.6% YoY. Residential Construction, WA (ABS) 9 8 Houses Commenced Dwellings Commenced Houses Completed Dwellings Completed 7 6 Dec-27 Dec-29 Dec-211 Dec-21 Dec-21 Dec-217 Value of Building Jobs, WA (ABS) 12 1 8 1 6 8 6 2 2 Mar-28 Mar-21 Mar-212 Mar-21 Mar-216 New Building Jobs (m/month) Alterations & Additions (m/month) 1 Mar-218 Value of Building Jobs (m/month) Source: ABS 872., T & T8 (Original Data) 7, 6,, Value of House/Other WA Residential Building Jobs (ABS) Houses Other Residential,, 2, 1, Alterations & Additions, Including Conversions Alterations & Additions, Including Conversions (Trend) New Construction New Construction (Trend) Source: ABS 871., T Source: ABS 871., Table 7 9

Urban Development Institute of Australia (UDIA) WA P: (8) 921 E: udia@udiawa.com.au Disclaimer While the data has been collected with due care for the purpose of reporting property market and general economic trends, no responsibility can be taken regarding its accuracy and individuals should conduct their own specific research before making any decisions. Information provided in this publication should not be taken as a guarantee of specific future movements in the market, but rather as an indication of historical market trends. All or part of this document may not be reproduced, published or included in any report without the approval of the UDIA (WA Division) as to the form and context in which it will appear. 1