Perth Property Market Reaches New Heights

On April 3, 2024, Perth's real estate market hit a milestone as the median sale prices for houses surged to unprecedented levels.

According to REIWA, the median house sale price in March climbed by 2.5 percent, reaching $620,000. Concurrently, the median unit sale price experienced an uptick of 1.2 percent, reaching $420,000.

This surge was attributed to the sustained high demand for homes, which continues to exert upward pressure on prices. Western Australia's population growth, coupled with a shortfall in dwelling completions, is driving individuals towards established homes, intensifying competition and subsequently inflating prices.

Year-on-year, house prices have soared by 12.7 percent, while unit prices have seen a 5.0 percent increase.

Despite the buzz about investors from the Eastern States, local buyers are the primary drivers behind the escalating prices. While Eastern States investors are drawn to WA's relatively affordable housing and promising yields, they tend to make financial decisions and are likely to look elsewhere if prices become too steep.

On the other hand, local buyers often make emotionally charged decisions, particularly if they have strong preferences for certain neighborhoods or develop an attachment to a specific property, making them willing to pay a premium, especially if they intend to reside in the property long-term.

Notable increases in house sale prices were observed in suburbs like Yangebup (up 4 percent to $644,500), Camillo (up 3.5 percent to $445,000), Beeliar (up 3.4 percent to $695,000), Mount Pleasant (up 3.3 percent to $1,550,000), and Belmont (up 3.2 percent to $590,000). Additionally, Ballajura, Scarborough, Inglewood, Palmyra, and Secret Harbour recorded growth of 2.8 percent or more over the month.

The swift turnover in the housing market is reflected in the time properties spend on the market. Houses sold in a median of eight days in March, while units took a median of 10 days. This rapid turnover poses challenges for both buyers and sellers.

Despite properties still entering the market, active listings settled at 3,654 at the end of March, 8.9 percent lower than February 2024 and 48.7 percent lower than a year ago. This continued low supply is driving prices up.

In the rental market, Perth's median dwelling rent rose to $649 per week in March, reflecting a 3 percent increase from February and an 18 percent increase from a year ago. Rental supply remains tight, with properties renting quickly and vacancies remaining low.

Overall, the housing market in Perth continues to experience strong demand, tight supply, and rising prices, with no immediate relief in sight.