Perth Property Market Guide: Trends, Investments & Prices

Perth’s property market continues to lead the nation, demonstrating unparalleled growth and setting new benchmarks. While other major capital cities have seen prices waver, median property values in Perth have surged to record highs, even surpassing Melbourne for the first time in a decade.

This impressive performance naturally leads investors to ask: Can Perth’s robust market repeat its success in 2025? With housing market predictions from REIWA forecasting a further 10% rise in 2025, a deeper understanding of the underlying drivers and future outlook is essential.

In this comprehensive guide, we will delve into Perth’s latest property trends, investment opportunities, and price dynamics for anyone considering investing in property in Perth, WA — so you can make informed, strategic decisions in this dynamic market.

Overview: Where Perth Stands in 2025

Price cycle since 2020: Sustained boom and minimal correction

Far from the boom-and-bust cycles seen elsewhere, Perth has maintained a consistent, sustained climb.

2020-2021: Initial rebound

Following a period of subdued activity, Perth’s market began a significant surge from mid-2020. This rebound was fueled by low interest rates, government incentives, and a growing confidence, with property values seeing notable increases.

2022-2023: Brief correction, continued momentum 

While the market experienced a modest correction during parts of 2022 and 2023, largely influenced by rising interest rates, Perth quickly regained its momentum. Unlike other markets that saw sharper declines, Perth’s dip was comparatively shallow and short-lived.

2023-now: Strong boom continues

Since late 2023, the market has resumed a strong upward trajectory, characterised by robust annual gains. While the frantic pace of earlier years has moderated, the environment remains highly competitive. Properties are still selling exceptionally quickly, with an average Days on Market (DOM) around 12 days in Q2 2025.

Here are the median sales prices for Greater Perth, illustrating this remarkable growth:

Role of interest rate cuts and supply constraints

Several key factors underpin Perth’s exceptional market resilience. The Reserve Bank of Australia’s (RBA) interest rate cuts in February and May 2025 have significantly impacted borrowing capacity and buyer confidence. With forecasts suggesting further cuts, demand is expected to receive another boost. 

Some SA3 regions have responded strongly to these cuts, with Fremantle, South Perth, and Melville showing faster growth in their 3-month rolling median trends. In contrast, Armadale, Stirling, and Mandurah have not seen their growth rates change or have slowed down.

Perth’s property market, despite strong price increases, is constrained by a persistent supply-demand imbalance. Affordability, population growth, and investor demand drive intense competition, but supply constraints from limited, costly construction keep housing stock well below demand.

While numerous regions are now seeing surging listings, the market’s overall tight inventory ensures that areas where listings remain constrained are likely to continue experiencing healthy growth:

• Surging listings: Kwinana (up 37.4% over the last 12 months), Serpentine – Jarrahdale (up 17.9%), and Gosnells (up 17.3%).
• Declining/stable listings: Perth City (down -2.6% over the last three months since April), Fremantle (down -8.8% over the last 12 months), and Cottesloe – Claremont (down -16.4% over the last 12 months).

Perth House Prices & Trends

Median house and unit prices

Perth’s property values continue to soar in 2025, with both median house and unit prices reaching record highs. The median house price for Greater Perth now stands at approximately $770,000, while units have reached a median of around $502,500. This translates to significant annual gains, 17.7% for houses and a striking 24.7% for units, highlighting the sustained demand for more affordable options as prices rise.

Suburb growth and performance

The strong overall market performance is reflected in outstanding growth across various Perth suburbs.

Currently, the top 3 high-performing suburbs (>1000 houses) and the highest house price growth include:

These top-performing areas often share common drivers such as affordability, lifestyle and amenities, infrastructure and connectivity, and strong rental demand.

Cost of Buying & Owning

Financing an investment property doesn’t end at the purchase price alone. A complete financial picture requires considering all associated buying and owning costs of Perth property.

For instance, for a median-priced, 3-bedroom house valued at $705,000 (assuming an 80% LVR), the approximate expenses typically cover:

Acquisition costs

• Deposit: $141,000
• Stamp duty: $27,503
• Conveyancing fees: $1,800
• Building and pest inspection: $700

Note that Western Australia has specific stamp duty rates that vary by property value and buyer type. As of May 1, 2025, first-home buyers purchasing a new home to live in (or vacant land to build on) pay no stamp duty regardless of value. 

Annual holding costs

• Property management fee: 7.50% of rental income
• Maintenance costs: Around $1,500 annually
• Council rates: Around $1,600 annually
• Water rates: Around $1,000 annually

The monthly after-tax cash flow in this example starts at approximately -$1,166 in Year 1. This negative trend is projected to ease, potentially resulting in a positive cash flow of around $455 by Year 15.

Rental Market Dynamics

Perth’s rental market remains one of the tightest in the country, challenging renters but offering major opportunities for investors. 

Here’s a look at current market conditions:

• Extremely tight market: Perth’s rental vacancy rate is at a low 0.49%. While this is an increase of 24.2% over the last 12 months, the market is still considered highly competitive. This means renters face stiff competition, often needing to apply quickly and potentially offer above the asking price, especially in desirable areas.
• Strong rental yields: Perth continues to offer some of the most attractive rental yields among Australian capital cities, making it a compelling proposition for investors. Currently, the average rental yield for dwellings is at 4.9%, with houses achieving a strong 4.8% on average. These healthy returns help offset rising interest rates and property prices.
• Significant rental price growth: The tight market has led to substantial increases in weekly rents. As of June 2025, Perth’s median weekly rents have reached approximately $680 for houses and $660 for units. This represents year-on-year increases of around 4.6% for houses and 10% for units, highlighting the ongoing pressure on rental affordability despite moderate growth.

What’s Driving the Perth Boom?

Perth’s extraordinary property market performance isn’t accidental, it’s the result of a powerful convergence of demographic, economic, and structural factors that set it apart from other capital cities.

Thriving economy and job market

Western Australia’s economy continues to thrive, largely propelled by its dominant mining and resources sector. The state’s economy is expected to grow by 4.25% for the 2024-2025 financial year. The unemployment rate has significantly improved, dropping from 8.1% in May 2020 to 3.9% in May 2025, a 51.85% decrease, attracting skilled workers and bolstering buyer confidence.

Heavy infrastructure investment

Significant government investment in infrastructure is transforming Perth, enhancing connectivity and boosting property values. Major projects include:

Relative affordability

Despite significant recent price growth, Perth remains considerably more affordable than its East Coast counterparts. From 2010 to 2020, Greater Perth’s median sales price saw 0.00% growth, leaving it significantly more affordable than other major cities by 2022:

• Greater Perth (2022): $525,000
• Greater Sydney (2022): $1,270,000
• Greater Melbourne (2022): $885,000
• Greater Brisbane (2022): $700,000

High population growth vs. low housing supply

Western Australia leads the nation in population growth, with Greater Perth expanding by 3.15% in 2023-24. However, this surge is colliding with a critical housing shortage. Despite minor fluctuations, total housing listings stand at 12,062 as of June 2025, reflecting persistent stock constraints.

Navigating Perth’s Suburb Hotspots

The Perth market is a dynamic collection of diverse suburbs, each with its own unique appeal and growth drivers. Understanding these distinct micro-markets is paramount to identifying prime opportunities for your investment strategy.

Here are the top 5 fastest-growing suburbs (with >1000 houses) in different price ranges, offering a glimpse into Perth’s most promising areas.

Under $750K median price:

Above $750K median price:

Market Outlook & Forecasts

In Perth’s property market, market pressure is easing but remains high. While growth is healthy, it is slowing in many submarkets. Do not expect the same level of development as last year. Strong fundamentals, including tight supply and robust migration, continue to underpin the market, impacting median house prices in Perth going forward.

Projections for 2025-2027

• According to REIWA, Perth’s house prices are projected to experience a 10% increase in 2025. This forecast follows a strong period of growth, with the median house price already having risen 16.4% over the 2024-25 financial year.
• The rental vacancy rate for Greater Perth was a tight 0.5% by June 2025. This low rate is indicative of a market with robust rental demand, suggesting continued strong rental yields. Rent increases are likely to continue, though at a more measured rate.

Potential market risks

However, several significant headwinds and potential risks can influence market dynamics:

• Interest rate volatility: While cuts are anticipated, unexpected economic shifts leading to higher or more prolonged interest rates could dampen borrowing capacity and buyer sentiment.
• Economic headwinds: Global economic uncertainty, particularly factors impacting commodity prices (a key driver for WA’s economy), and broader geopolitical tensions could indirectly affect local market confidence.
• Construction sector recovery: A faster-than-expected increase in new housing supply could ease price pressures, though significant improvements in building capacity are unlikely in the short to medium term.
• Affordability constraints: Sustained price growth could eventually push affordability limits for a segment of the market, potentially leading to a plateau in demand.

Investing in Perth: Is Now the Right Time?

Yes, Perth offers a compelling opportunity for investors looking to diversify their portfolios with robust, long-term assets. The market’s strengths include significant population growth, a persistent housing undersupply, and attractive rental yields. These factors combine to support ongoing capital appreciation and a reliable income stream, positioning Perth as a standout for strategic investment.

However, if you’re a first-time investor chasing low entry prices, rapid short-term capital gains, or high rental returns, keep in mind that Perth’s competitive landscape is gradually shifting, reducing these specific advantages. It’s also important to remember that Western Australia’s economy, while expanding, still leans heavily on mining, making it somewhat sensitive to global commodity swings.

Conclusion

Perth remains a top-tier investment destination in Australia, powered by a growing population, critical housing undersupply, and enduring affordability. While its rapid pace may temper, expect continued healthy growth and strong rental yields, making it an excellent long-term investment.

Need expert guidance on how to buy an investment property in the Perth property market? Partner with InvestorKit. We deliver data-driven insights and tailored strategies to help you build a winning portfolio in Western Australia’s thriving capital.

Book a complimentary discovery call now and invest smarter in Perth.