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Migrants help to boost boom in WA

WESTERN AUSTRALIA'S booming population should boost the local real estate market, according to Ryan Dhue, executive director of The Mortgage Gallery.

New Australian Bureau of Statistics figures show that the population grew 1.6 per cent or 32,000 people last year.

"This was the second fastest growth rate in Australia, second to Queensland where the population grew by 2 per cent," Mr Dhue said.

"West Australia's population growth is now growing at nearly twice the rate of New South WALES and more than three times the rate of South Australia.

"The State's population is rising at a very high rate because of the growing number of people who are moving here from overseas and interstate."

He said the growth rate was reflected by the rising number of home loans the company was organising for people from interstate.

Perth offered some of the most affordable housing in Australia.

"The median house price in Perth is still more than $220,000 lower than Sydney and the quality of homes is much higher," he said. "Many of these migrants are buying homes in coastal areas such as Mindarie because of the lifestyle they offer."

He said that in some parts of the metropolitan area, home loans for people from interstate were accounting for more than 20 per cent of home loans organised by the company.

The strong demand was a key reason the housing market in West Australia had remained buoyant while the Eastern States had become more subdued.

Most homebuyers are making extra repayments on their loans and preparing well for any future rate rises, according to a new survey.

Although most of those surveyed think interest rates will rise before Christmas, they do not feel this will have a drastic effect on their finances.

The survey was carried out by non-bank lender RESI Mortgage Corporation and financial research agency Infochoice.com.au between May 20 and June 1.

It showed that most respondents placed a high importance on paying off a home loan quickly, with 69 per cent of those with mortgages making extra repayments into their loans.

Almost 73 per cent thought the Reserve Bank would increase rates before the year ends. About 15 per cent disagreed and 12 per cent were unsure.

Despite Australia's big average mortgage sizes, only 10.2 per cent of respondents with mortgages felt a rate rise would have a "drastic" effect on their finances.

About 55 per cent thought a rise would have a "noticeable but not severe" impact. The rest thought the effect would be "minimal".