The state economic outlook for Western Australia is looking promising, with a forecasted upturn in resource investment and government capital expenditure. Population growth is exceeding 3% per year, with both interstate and overseas migration being drawn to Perth due to a strong labor market and relatively affordable housing. This sets a solid foundation for continued double-digit price growth in the near future, with the median house price expected to increase by 12.9% in 2024, surpassing Adelaide once again. The Perth property market has shown a tendency for significant upswings in price cycles, with potential for further growth.
The combined capital city all-dwelling median price increased by 1.5% quarter on quarter, reaching $946,000 in December. This growth was supported by cities like Perth, Adelaide, and Brisbane, masking the slowdown in momentum in Melbourne and Sydney. Houses saw a 7.6% increase over the year, while units gained 5.7%. Anticipated interest rate cuts from late 2024, combined with a sustained housing shortage, are expected to further accelerate price growth in 2025. Perth’s median house sale price set a new record of $620,000 in March, with houses selling within a median of eight days.
Data released by the Real Estate Institute of WA indicates a strong demand for homes in Perth, which continues to drive up prices. The state’s population is increasing at near-record rates, with a 3.3% increase to over 2.9 million in the year leading up to September 2023. Dwelling completions are falling short of meeting the housing needs of these additional households, leading people to turn to the established homes market to find accommodation. This high demand creates intense competition for homes, further pushing prices upward. House prices have risen by 12.7% year-on-year, while unit prices have also increased by 5%.
Overall, the Western Australian housing market is experiencing growth and competitive demand, driven by a strong economy, population growth, and a shortage of housing supply. The outlook for the market seems optimistic, with forecasts of continued price growth in 2024 and beyond, especially in cities like Perth where prices are setting records. The real estate industry in WA is expected to remain robust, with potential for further upswings in the property market cycles. As the state’s population continues to grow and demand for homes remains high, prices are likely to continue their upward trajectory, creating opportunities for both buyers and sellers in the market.
