Is the WA market over-heated at the mo?

I'm a great believer in WA/Perth and think that its the place to be in the medium to long term, but i notice:

- housing prices are already in excess of 2007 boom levels
- economic recovery seems to have stumbled somewhat
- stock market currently going backwards
- resources projects still arent where they were a couple of years ago
- half of Perth office space still seems to be up for lease

Has Perth got itself a bit ahead of itself in terms of recovery and potential next boom? Whats underpinning the current growth/ high prices in Perth?

This year i'm looking for IP1 and a new PPoR but i cant help thinking it might be worth giving it a few months to see what direction we're going in...

Interested in all opinions... i know nothing about economics, just going on gut feel.

Sam :)
I have the same sentiment as you.

I'm not motivated to purchase a property for around $430k knowing I could have purchased it for $370k 6 months ago. Properties seem to have risen too quick. I'm still seeing the odd well priced property, but they go quick. Some of what's on the market now seems overpriced, but doesn't seem to be selling.
Who knows what will happen but we still have a shortage and there's demand. Yields are still low but if you are in it for the long term and don't mind the holding costs, things will work out.
it has been quite surprising actually.

In the middle of last year, the feasibility study for building duplexes on IP2 that we bought last year didn't add up, with completed houses expected to sell for about $450k. We just found similar new duplexes in the same area listed on yesterday for $620k. If this continues, by the time we get around to finishing them, they could be worth in excess of $700k. Crazy for the area.

Whats going on?
Sam there is still good buys around, you just have to look harder and act fast when you see an underpriced property. I think the only directions will be sideways and up, and agree with the other comments made by other posters.
The problem is more at the $1m+ end i think... I just cant believe how much prices have risen and whats behind it all...?

I guess people think there is going to be another boom (as i do), which is kind of like actually being in one as people want to get into the market before prices take off - self-fulfilling prophecy!
there has been some recovery towards where prices were 3 years ago but i feel this thing is only just starting. still the odd bottle of old milk left on the shelf here and there if you are quick.
All this growth in WA has been reported in a US online newspaper:

Of most interest to those here:

Fast growth in Perth

No city better illustrates the China boom than Perth, the capital of Western Australia, a state five times as big as Texas that holds the bulk of Australia's mineral wealth. The state's average income has jumped $10,000 in five years to more than $70,000, thanks to China's purchases of iron ore, natural gas and other resources. In Perth, the median price for a home just broke $500,000. Its unemployment rate is a measly 2.6 percent; the national rate is just 5.5 percent and predicted to drop this year -- thanks mostly to China.

Beyond the numbers, Perth looks Chinese, with a skyline filled with skyscrapers and cranes. The city is bristling with more than $1 billion in new construction, including a hospital, museum, highways, offices and a vast indoor entertainment and sports complex. More than 110 people move into Western Australia each day, making it the fastest growing state in Australia, and there's still a labor shortage. Truck drivers working in the mines are paid $100,000 a year. A gate attendant at a mine makes $80,000.
Thats what worries me... realistically how much better can we get? The place just feels overheated at the moment... people are acting like the boom is on again but the rest of the world is still dusting themselves off after the GFC :confused:
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