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Oversupply overstated

Recent reports of apartment oversupply in Perth do not add up according to Stirling Capital.

Despite the recent slow down in population growth, all forecasts still suggest Perth will overtake the population of Brisbane in 2028, becoming Australia’s third most populous centre (ABS).

“Overseas migration accounts for 60 per cent of Perth’s population growth and migrants are coming from locations where apartment living is well established. Add to that an ageing Australian population and declining household sizes are leading to an increase in demand for smaller homes, “ Luke said.

In its forecasts, Urbis tips apartments will soon account for 30 per cent of dwelling approvals, up from levels of 18 per cent now, in Perth in the next five or 10 years. In Sydney or Melbourne, apartments make up 30-40 per cent of the residential market over individual homes.

“With a greater push for density and urban infill by the WA Government, we will likely see an increase in apartment living across the state. Downsizers can remain close to their existing residence and downsize, while first home buyers can enter a suburb which may otherwise be unaffordable. Now is a great time to buy,” Luke Reinecke said.

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