An exclusive new Housing Equity Report by Aussie Home Loans and CoreLogic RP Data shows that the highest home equity levels located in Western Australia are in the council areas of Subiaco and Melville, followed by Augusta-Margaret River in third place.
Equity is simply the difference between the debt held on a property (based on Aussie’s mortgage data), against what the property is currently valued at (according to CoreLogic).
The average home in Western Australia currently has 38.5 per cent home equity, with an equity value of $178,794*.
Top 10 and Bottom 10 council regions in Western Australia – percentage and dollar values
Executive Chairman of Aussie, Mr John Symond, said “It is no surprise that the Perth metropolitan region leads the state in the equity built up in homes, as people are becoming more interested in living closer to the action in the city.
“I believe the best investment both for security and lifestyle is still real estate and I see no reason why this will change over the next decade, especially in view of the lower interest rate climate, lack of housing supply in the major cities and continuing population growth.
“As long as owners are covered comfortably with their mortgage repayments, the equity they have built up in their homes allows them to kick some personal financial goals, like education for their children or renovation”, he added.
Subiaco is the top council area with equity averaging 55.7 per cent or $509,411 above the debt held against its homes, followed by Melville (54.4 per cent) and Augusta-Margaret River (53.8 per cent).
Property prices in Perth suburbs have risen to an annual compounding rate of 7.8 per cent over the last 20 years.
Average level of home equity – state by state percentages and dollar values
The Dardanup council area has recorded the lowest average home equity within Western Australia, with an average home equity percentage of 25.3 per cent worth $93,941, just beaten by Kalgoorlie/Boulder (25.4 per cent) and Northampton (28.2 per cent).
Mr Tim Lawless, Research Director of CoreLogic RP Data, said “Perth dwellings have shown a strong rate of appreciation over the long term, however housing market conditions have softened over the past twelve months which is placing some downwards pressure on local values. Those home owners who have held their property for several years are likely to have accrued some level of equity in their home.”
Average level of home equity – city by city in percentage and dollar terms