Perth’s property market will boom with significant growth over the next five years, driven by a combination of economic factors, population growth, and a persistent imbalance between supply and demand.
With these Perth property predictions next 5 years, buyers and investors can expect Perth property prices to rise steadily as these dynamics shape the market. Here’s what to expect from Perth property prices and overall market trends moving forward.
Current Market Performance
As of 2024, Perth property prices are still rising, with the median house price at $668,000, by mid-year. That’s a big jump from last year and shows the demand is high and supply is low.
For those asking, “how much does a house cost in Perth?” this figure is crucial to consider.
Unit prices are rising too, with the current median unit price at $450,000, and forecasts predict it will reach $459,000 by 2025. These trends reflect the overall strength of the Perth property market.
Here’s what to expect from Perth property prices and overall market trends moving forward.
2024-2029 Property Predictions
Over the next five years, Perth property prices will continue to rise. Here are the predictions:
- House Prices: Median house price to increase by 8% per year to 2025, potentially to $750,000 by 2025.
- Unit Prices: Not growing as fast as houses but still growing, 3.4% to 3.9% per year to 2025.
- Rental Market: The rental market in Perth will be tight, with low vacancy rates and high rental yields. Median house rents to exceed $600 per week by the end of 2024 due to strong demand and limited supply.
Projected Median House Prices in Perth
- 2024: The median house price in Perth is forecasted to reach $690,000, reflecting an 8.4% increase from the previous year.
- 2025: Continued growth is expected, with the median house price predicted to rise to $740,000 by the end of 2024 and then stabilize at $750,000 by mid-2025.
- 2026-2029: Over the next five years, Perth’s median house price is anticipated to see annual growth rates between 6% and 8%, potentially reaching $900,000 by 2029.
Projected Median Unit Prices in Perth
- 2024: The current median unit price is $450,000.
- 2025: Forecasts predict the median unit price will increase to $459,000 by mid-2025.
- 2026-2029: Unit prices are expected to continue rising, with an average annual growth rate of around 3.5% to 3.9%, leading to a potential median price of $520,000 by 2029.
Rental Yields
- Current: Rental yields in Perth are among the highest in Australia, currently sitting at around 6% for houses.
- 2024-2025: With rental prices expected to increase further, rental yields may rise slightly or maintain current levels due to the high demand and low vacancy rates. The median rent for houses could exceed $600 per week by the end of 2024.
- 2026-2029: Rental yields are projected to remain strong, with ongoing pressure from population growth and limited new housing stock.
Long Term Outlook
Further out, the outlook for Perth property prices is good. The city will continue to grow, house prices and unit prices will keep rising.
This growth will be driven by population growth, economic resilience and limited housing supply, making Perth one of Australia’s best property markets over the next 5 years.
Suburb-Specific Predictions
Some suburbs in Perth will boom over the next 5 years due to affordability, infrastructure and demand.
For those considering investment, it’s worth exploring the properties for sale in Perth to identify promising opportunities.
Perth Suburbs Set to Boom
| Suburb | Median House Price (2024) | Predicted Growth | Key Factors |
|---|---|---|---|
| Baldivis | $625,000 | 8-10% annually | Affordability, family-friendly amenities |
| Scarborough | $1,097,500 | 7-9% annually | Beachside location, lifestyle appeal |
| Bayswater | $822,500 | 6-8% annually | Proximity to CBD, infrastructure upgrades |
| Cottesloe | $3,487,500 | 5-7% annually | High demand, prestigious suburb |
| Subiaco | $1,690,000 | 6-8% annually | Central location, strong demand |
| Mount Lawley | $1,505,555 | 5-7% annually | Heritage homes, vibrant community |
| Fremantle | $1,200,000 | 6-7% annually | Coastal charm, historical significance |
| Joondanna | $800,000 | 4-6% annually | Close to CBD, strong rental market |
| Victoria Park | $881,000 | 5-7% annually | Urban living, proximity to city |
| Tuart Hill | $831,400 | 5-6% annually | Desirable suburb with solid growth |
Factors Influencing Future Growth of in Perth’s property market?
Growth in Perth’s property market is driven by:
- Population Growth: Western Australia’s population growth is one of the highest in the country, 2.8% in 2023. This has driven a lot of the housing demand in Perth.
- Low Supply: There are not enough properties for sale, and listings are well below the 5-year average. This supply shortage is putting pressure on property prices.
- Economic Stability: Perth’s economy is strong, particularly in the resources sector. This is good for first-home buyers and investors, making Perth a good market.
- Interest Rates: Despite interest rates rising, demand is still strong due to the local economy and limited supply.
- Government Initiatives: There are initiatives to increase housing supply through new builds but these won’t meet the demand in the short term.
Investment Opportunities in Perth
For investors Perth is a one off in the Australian property market. The city is more affordable than Sydney and Melbourne and has strong population growth and demand so it’s a great place to invest.
Affordability and Growth
Perth is one of the most affordable capital cities in Australia especially compared to Sydney and Melbourne. More affordable and the potential for big price growth over the next 5 years make it a great option for investors to get in or expand their portfolio.
Population Growth Driving Demand
Perth has one of the highest population growth rates in Australia, driven by domestic migration and international immigration.
The new residents are driving demand for housing, especially in suburbs that offer a great lifestyle and proximity to amenities. As demand outstrips supply Perth property prices will rise and those who invest now will benefit.
Suburbs to Watch: Cottesloe and Baldivis
- Cottesloe: This suburb is famous for its beaches and lifestyle, Cottesloe is one of Perth’s most sought-after suburbs. It always has high demand so it’s a great location for capital growth. While Cottesloe is more expensive, the potential for further price growth makes it a great long-term investment
- Baldivis: More affordable than Cottesloe but also expected to see big price growth. Baldivis is popular with families due to its community amenities and good schools. As more people move to Perth suburbs like Baldivis which offer affordability and lifestyle, are more likely to see big growth in property values.
Emerging Suburbs and Infrastructure Developments
Beyond these suburbs, there are many emerging areas in Perth that are getting new infrastructure. Suburbs with transport upgrades, new schools and shopping centres are great for property investors.
These developments make the area more liveable and drive up property prices as demand increases.
Rental Yields
Perth’s rental market is also great for investors. With rental yields one of the highest in Australia and low vacancy rates investing in rental properties in Perth can give good returns.
Suburbs close to the CBD or with easy access to public transport are great for rental investments as they attract more tenants.
3 Risks in the Perth Property Market
While the outlook for Perth’s property market is good, there are several risks that could impact it over the next 5 years. Investors and buyers should consider these when making decisions.
1. Economic Downturn
A sudden economic downturn could hit property prices and rental demand hard, especially in areas that are heavily reliant on the resources sector.
If global demand for iron ore were to drop, this could lead to job losses and reduced economic activity in WA. This could result in less demand for housing and downward pressure on Perth property prices
2. Government Policy Changes
Government policy changes are another risk to the Perth property market. These could include:
- Tax Changes: New taxes or changes to existing ones could affect property affordability. For example, an increase in stamp duty or land tax could make buying property more expensive and reduce demand. Changes to capital gains tax or negative gearing could impact property investment.
- Foreign Investment Restrictions: The Australian government has previously restricted foreign investment in residential real estate. If they do again, this could limit the number of buyers, especially in the higher end of the market where foreign investors are more active.
- Housing Affordability Measures: Governments may introduce policies to improve housing affordability, such as grants for first-home buyers or incentives for developers to build affordable housing.
While these could increase supply and get more local buyers in, they could also create market distortions that impact price growth.
3. Migration
Migration is a key driver of housing demand in Perth. If migration patterns change, especially if population growth slows, demand for housing could decrease.
This would likely mean slower growth or stagnation in some areas.
Perth’s population growth has been the engine of the property market so any changes to this trend will have big implications.
Conclusion
The next 5 years will be a growth period for Perth property prices. With strong economics, increasing demand and limited supply, Perth is one of the best property markets in Australia.
Whether you’re a buyer, investor or renter, you need to know these trends to succeed in the Perth property market.
For more info and current listings, go to the Perth property market or properties for sale in Perth.
Sources: Information sourced and compiled on 28/08/2024.
FAQs on ‘Perth Property Predictions’
Is Perth property going to boom?
Perth house prices are predicted to rise between 8% and 11% in the coming year, according to PropTrack. Limited housing stock and increased demand have contributed to this predicted price hike, following a 19% increase in Perth property prices over the past year.
Will house prices keep doubling every 10 years?
Despite the rapid acceleration in home prices during the pandemic, prices have been taking longer to double than they did previously.
What will your home be worth in 2027?
If the current growth trajectory continues, the median house price in Sydney is expected to reach $1.92 million by 2027, with the median unit price hitting $1.02 million. Sydney’s prices would be nearly triple those in Perth, Adelaide, and Darwin.
What could your house be worth in 2028?
By 2028, million-dollar unit prices and $2 million house prices could become the norm in Sydney. Some suburbs might see buyers paying double the current prices.
Is it a good time to buy property in Perth?
Yes, 2024 is considered a good time to buy property in Perth due to strong market growth, affordable prices compared to other major cities, and favourable economic conditions. However, it’s essential to research local market trends and consult a real estate expert.
What is the future growth of Perth?
Perth, the capital of Western Australia, is forecast to grow to 2.9 million people by 2031 and 3.5 million people by 2050, making it the third-largest city in Australia after Sydney and Melbourne.
