Small signs of property price recovery

WA's sluggish property market is at last showing signs of recovery with new figures revealing the median house price has risen for the first time in more than 18 months.

The 0.5 per cent boost in the three months to December is the first rise since March 2010.

Perth's median house price is now $465,000, according to Real Estate Institute of WA data.

REIWA says it could be the end of an extended period of falling prices.

President David Airey said the shift was largely triggered by an increase in trade-up buyers countering the influence of first homebuyers.

"First homebuyers have been skewing the median downwards by generating large sales volumes of more affordable homes," Mr Airey said.

"REIWA data shows that while first homebuyers continue to be active in the market, we saw an increase in trade-up buyers during the December quarter and increase in house sales of around six to seven per cent which may have put a floor under prices.

"The encouraging thing is that listings are currently 12 per cent lower than the same time last year and well down on the peak of 18,200 in April last year."

This year kicked off with 13,500 listings, the lowest since May 2010. Perth's long term average is 12,000.

Propell National Valuers WA residential valuations manager Travis Coleman said while there was still a lot of stock on the market, sales activity had increased which he attributed to interest rate cuts.

"We have seen an increase in sales coming through, particularly in the bottom end of the market to the middle tier in suburbs more confined to areas around the median house price and below," he said.

"A lot more homes are under contract which we have not seen since the middle to early last year."

Acton group managing director Graeme Baxter said there were early signs of gradual recovery.

"Buyer confidence is rising, prices remain reasonable and interest rates are low - all are good indicators," he said.

In the rental market, the vacancy rate has tightened to 2.3 per cent. A year ago, the rate was 3.4 per cent. Weekly rents have risen to $420, a $20 increase in the quarter.