When Will Market Peak?

Looking at Cotality’s graphical representation of changes to Perth’s dwelling values since 1990, we are a market prone to steep ebbs and flows. Rolling five-year increases to dwelling value as at June 1991 was 94%, September 2006 137.8% and our most recent spike September 2025 82.7%. Our current price cycle is strong but not without precedent.

Investors continue to see value in our market representing 38% of all lending activity in WA; bang-on the national average and more than double the proportion five years ago. First home buyers remain engaged despite affordability constraints representing 23.5% of the market. It will be interesting to see if the recent changes to the First Home Buyer Guarantee scheme change these proportions in the months ahead.

Overall, sales volumes remain strong, above the five (7% above) and ten (29% above) year averages. Volumes are holding at these high levels despite listing levels falling to record low levels down by 58% compared to the previous ten-year average and 45% below the previous five-year average. According to Cotality, Perth had 25,000 property listings in September 2018. Today there’s 7,796. This startling fall in listing supply is certainly contributing to the bullish market sentiment. Large numbers of buyer enquiry, busy home opens, multiple offers and rising prices continue as key features in the market as buyer compete for the limited choices available. Over the past five years, dwelling values are up 82.7% or $387,042 – the highest gain of all Australian capitals.

Population growth in WA has slowed but is still above the five and ten year averages; up 285% and 114% respectively. Undoubtedly, population gains have contributed to the demand side of the market and exacerbating supply constraints. There are hoards of would-be sellers frustrated by the lack of suitable supply available. The vicious cycle of “we will sell if we find something that meets our needs” continues, a blockage in the market that will prevail until more desirable supply begins to flow.

Dwelling commencements have improved across WA, up 31% from last year now running at similar levels to completions. And the most obvious sign that supply is beginning to impact is the annual number of new residents per dwelling completion figure now at 3.1 residents down sharply from the June 2023 peak of 6.4 residents.

In summary, it will take some time for this market to wash out, even if there is a dramatic drop in demand or surge in supply. Prices will continue to rise despite affordability pressures and anything that fuels demand (such as an interest rate cut) will prolong this upward trajectory of property values.