INFLATION, INTEREST RATES, GRANNY FLATS

 Will interest rates hold this week? 

Perth's inflation rate takes a dip

This week the Australian Bureau of Statistics released data for the December quarter 2023 which shows that Perth's inflation has taken a welcome step back to 3.6% in 2023, well below the national average of 4.1percent. This decrease in inflation in Perth’s end of year inflation rate was underpinned by slowing price growth across a range of sectors including food, housing, transport amongst others. This is not just great news for your wallet but also signals a potential shift in the economic winds.

What does this mean for interest rates?

The Reserve Bank of Australia (RBA) has been using increases in interest rates as a tool to curb inflation. A softer inflation may encourage the RBA to consider a more tempered approach to interest rates in 2024. While it’s premature to predict exact movements, the current downward trend in inflation suggests a potential easing of upward pressure on interest rates.

Granny flat regulations changes to boost housing supply

This week the State Government announced another measure to address the shortage of housing in WA with the introduction of amendments to relax requirements relating to ancillary dwellings. Ancillary dwellings, commonly referred to as “granny flats” of 70sqm or less, will no longer require Council approval provided they meet setback requirements. The Government has also removed the minimum lot size requirements for ancillary dwellings. Homeowners will no longer have to go through a (sometimes lengthy) planning process to obtain approval. A building permit will still be required and which is stated as taking a maximum 10 business days. The new rules are scheduled to take effect mid-April 2024. 

With the Perth rental vacancy rate sitting at 0.7percent and median rental prices hitting a new peak of $610 per week at the end of 2023, many families are finding granny flats a useful option for housing extended family or in providing work from home (WFH) accommodation. 

Realestate.com.au analytics also indicate there has been a significant increase in searches for properties with granny flats in 2023.

One thing is for sure Perth is in for a ride over the next 1-2 years and no property prices are not reducing so stop sitting on the fence.

MAKE YOUR OWN DECISION AND GIVE IT A REAL GO!!

SELLING MOSMAN PARK & THE WESTERN SUBURBS!!

KEEPING IT REAL IS OUR MOTTO!!