The West Australian property market is being decimated following the evaporation of the resources boom, with values of $1 million-plus properties plummeting 20 per cent and the equivalent of more than two years' supply of homes flooding real estate agencies.
In Geraldton, rents have slumped 8 per cent and in the state's northwest fibro shacks that had been fetching rents of $1000 a week are sitting vacant as formerly high-paid mining executives face widespread retrenchment.
Real Estate Institute of Western Australia deputy president David Airey said there had been just 85 sales in Perth's affluent western suburbs in the three months to December, down from 150 the previous quarter and 300 at the same time in 2007. "Properties ... purchased as recently as a year ago have been listed or sold below their original asking price," he said.
Mr Airey said house prices in the state were expected to fall further as the global financial crisis continued to unfold and mining companies retrenched staff.
Adviser Edge head of property research Louis Christopher said Perth house prices were expected to fall by between 8 per cent and 12 per cent this year.
"The cause of the falls at the moment is the decline in commodity prices, (the rise in) which is what actually caused the boom in the first place," he said.
According to the REIWA, much of the lower end of the market was holding ground, buoyed by a surge in people capitalising on cheaper homes and a tripling of the first-home buyers grant.
"Properties priced up to $400,000 in areas popular with first-home buyers have either been steady in price or fallen only very very marginally."
In Perth, house prices fell 4per cent in the December quarter, taking the yearly decline to 11 per cent.
The median price of a Perth house was $418,000, down from $473,000 at the peak of the West Australian housing boom in December 2007.
