Perth WA Property Market Update

— 2025, Q1 Insights

Key Points – Q1 2025 Perth Property Market Update

• A steadier start to 2025 after the intense FOMO-driven market of 2024. Buyer demand remains strong, but sales activity was limited over the holiday period, with activity picking up post-Australia Day.
• Shift in buyer demographics – more local WA homebuyers and investors are entering the market, though eastern states investor interest remains high (WA vs. interstate inquiries are now 50-50 at our buyer’s agency since the start of 2025).
• Moderation in growth rates – properties are taking slightly longer to sell, now averaging 13 days on market, but some suburbs remain highly competitive.
• Homeowners are capitalising on equity gains, with many considering upgrades or new investments, though some wonder if they’ve missed the boom.
• Perth’s growth cycle may have more to go – historical trends show past booms lasted 8-10 years with total price gains of 141%-167%, while the current cycle is only two years in with 40% growth.
• Key market drivers remain strong, including population growth, high employment, low supply, affordability, and potential rate cuts.
• Property selection is more critical than ever – the right opportunities still exist, but careful investment decisions are essential.

 

Full Report – Q1 2025 Perth Property Market Update

The frenzied FOMO-driven market of 2024 has given way to a steadier start in 2025. Following an intense year of activity, many real estate agents took a well-earned break between December and January. Despite sustained buyer demand, limited new listings over the holiday period left buyers with fewer options. However, as expected, market activity picked up significantly after the Australia Day long weekend, with more properties hitting the market and a strong number of transactions.

(Source: REIWA – Over the holiday season, sales were well down with days to sell up 3 months ago. Last month, sales and days to sell are now much stronger).

Since the beginning of the year, we’ve observed a shift in buyer demographics. While eastern states-based investors heavily dominated 2024, 2025 has seen an increase in local WA homebuyers and investors. That said, the balance of inquiries at our Buyer’s Advocate Perth office remains roughly 50% from WA buyers and 50% from interstate and international investors. Perth continues to attract strong investor interest, particularly given that other major markets have peaked while Perth remains relatively affordable with strong rental yields.

Market Conditions: A Healthy Breather

The pace of price growth has moderated, and average days on market have edged to 13 days—still a quick turnaround historically, with some suburbs selling even faster. This slight slowdown should be seen as a natural breather after the intense market activity of 2024, combined with the seasonal lull over the holiday period.

(Source: REIWA – 1st April 2025)

Over the past two years, Perth’s median house price has surged by over 40%, delivering strong equity gains for many homeowners. As a result, an increasing number of property owners are now considering upgrading their homes or expanding their investment portfolios. However, some potential buyers are questioning whether they’ve already missed the Perth boom.

Perth’s Growth Cycle: More Upside to Come?

While the market has seen two consecutive years of double-digit price growth, historical data suggests Perth’s growth cycles typically last much longer. In past booms, such as the 1980s and 2002-2010, growth cycles spanned between 8.8 and 9.8 years, with total price appreciation ranging from 141% to 167%. By comparison, Perth’s current growth phase is only two years in, with a total gain of just 40% — well below the levels seen in past cycles.

(Source: ProSolution)

As homeowners with strong equity assess their options, confidence in the market is likely to strengthen—especially post-election, with potential interest rate cuts, or if the government introduces further incentives for first-home buyers and investors to help alleviate the rental crisis.

For many homeowners, the realisation that their fully or partially paid-off home has doubled in value since purchase could be the catalyst for action. With an additional $500,000 – $700,000, they now have the opportunity to upgrade to a home with superior amenities and secure a spot in a sought-after public school zone.

We anticipate 2025 will be the year of the upgrader, as more homeowners leverage their increased equity to move into properties that better suit their lifestyle and long-term goals. The upgrader market has always been a key part of a capital city’s property cycle, yet Perth has only just begun to see this trend emerge—suggesting further momentum ahead.

Key Market Drivers: Why Perth Still Has Room to Grow

Several structural factors continue to support property prices, including:

• Strong economic fundamentals and employment growth
• Sustained population increases
• Limited housing supply and high construction costs
• Relative affordability compared to other Australian cities
• Banks maintain an appetite to lend, with potential future rate cuts

 

(WA remained the most affordable state, with only the two territories being more affordable – Source: REIA Housing Affordability Report)

 

These positive tailwinds suggest that while price growth may moderate, Perth’s property market remains well-positioned for further gains.

Looking Ahead

For buyers, the key to success in 2025 will be selecting the right properties—as not all will perform equally well. With market conditions evolving, careful asset selection and expert guidance remain crucial. If you’re looking to make a strategic move in Perth’s property market, get in touch for insights on how to navigate the opportunities ahead.

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