The injection of 1,300 new affordable homes into Western Australia is expected to be absorbed without any oversupply, according to Perth’s Property Wizard’s managing director Liz Sterzel.

The collaboration between the Department of Housing and the Metropolitan Redevelopment Authority (MRA) will see an increased supply of affordable housing delivered across central Perth, Midland and Armadale. This comes as a part of the state government’s Affordable Housing Strategy to provide at least 20,000 new affordable dwellings by 2020.

While a concentration of affordable housing in one area can have a negative influence on local home prices, Ms Sterzel told Smart Property Investment that the spread of homes across the different areas means there is little risk to investors.

“So far, these homes appear to be spread throughout their large array of target areas across Perth and the regions and not concentrated in any one area, which makes sense because the Department of Housing has just spent the last decade or so reversing concentrations of state housing and spreading it through the suburbs,” Ms Sterzel said.