Cottesloe, the famous beachside suburb in Perth that is home to many of the corporate elite, is often considered the barometer for the health of the capital’s property market.
There are signs that the upper tier of the market, which mining billionaire Andrew “Twiggy” Forrest calls home, has been in recovery for the past six to eight months, after taking a brutal hit after the financial crisis.
A recent standout sale was the sale of 72 Marine Parade, right on the beach, for $6 million, a 20 per cent gain improvement from when it last traded in 2016.
Median prices have improved, rising back up to $2.1 million, after a slump to about $1.7 million in early 2014 after the boom ended, sales data shows.
But most of the properties selling in Cottesloe in the past few months are higher-end transactions of $1.5 million to $3.5 million.
Rossen Real estate’s Greg Rossen said wealthier families were moving sideways and trying to snap up deals while the market remained soft.
“It’s still extremely bad in Perth. Many people are still underwater,” Mr Rossen said.
The data shows the market remains far below the peaks reached at the top of the mining boom in 2012; the number of sales is lower and the number of listings is flat.
Vacancies in Cottesloe are still high at more than 5 per cent, compared with 2 per cent in 2012, following the departures of many mining executives from rental homes and serviced apartments.
In the bracket where buyers depend on jobs for a mortgage to buy a home, there has been little improvement, according to the deputy president of the real estate institute in Western Australia, Damian Collins.
“The established tier of the $550,000 to $1 million bracket is going OK, but we are not seeing any growth in the bottom bracket,” Mr Collins said.
“What’s been hurting that part of the market is confidence, there hasn’t been a recovery in confidence.”
The biggest transaction in the suburb in recent years was Andrew Forrest’s $16 million purchase of the 5000 square metre beachfront mansion “Tukurua”.
But even then the billionaire got a bargain, according to local agents. At the peak of the mining boom around 2012, the home could have been valued at $35 million.
Other well-known Cottesloe mining executives include Mineral Resources’ co-founder Steve Wyatt.