Perth’s housing market is leading the nation to record a double-digit increase over the year and set a new record median of $713,811.
Domain’s House Price Report for the September quarter shows Perth house prices lifted 3 per cent over the quarter, an annual change of 10.4 per cent.
Perth house prices are continuing to rise.Credit: Ross Swanborough
Adelaide and Perth recorded the highest price gains over the quarter and were the only capital cities where house prices were at an all-time high.
Domain chief of research and economics Nicola Powell said if mortgage rates weren’t so high, price growth would be even faster due to the chronic undersupply of housing in WA.
“Perth remains severely undersupplied,” she said.
“The housing market continues to benefit from a positive flow of net interstate migration, record levels of overseas migration and being Australia’s tightest city rental market.”
Leading the charge, Parmelia house prices skyrocketed 20.8 per cent over the year to a median of $392,500, while Bullsbrook clocked similar gains to reach a median of $525,000.
House prices were up 19.6 per cent in Leederville (a median of $840,000) and 18.3 per cent in Churchlands (a median of $1.42 million).
Herron Todd White director Chris Hinchliffe said last year, first home buyers could pick up a four-bedroom, two-bathroom home in the lakeside suburb of Edgewater for under $700,000, but now needed to ease their expectations, with the same price only buying them a three-by-one.
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He said they remained eager to buy but continued to face challenges.
“It’s not uncommon for properties to not even be presented to the local home buyer market, with many properties being offered to eastern states-based buyers’ agencies off-market,” he said.
“With the rental market extremely tight and the pressure of properties selling quickly there are first home buyers pushing their budgets even higher to the $600,000 to $700,000 bracket to secure quality, move-in ready products, battling it out with investors and older-generation downsizers.”
But not all suburbs are booming. Ascot prices fell 23 per cent to record a median of $612,500. Inner-city locations Leederville, East Perth and Subiaco also recorded significant double-digit declines in house prices.
North Coogee has fallen out of the million-dollar club after making its entry in May, with the median value of a house declining 10.9 per cent to reach a median of $890,000.
“Unit prices increased over the quarter and year to provide the best outcome since 2021,” she said.
“In fact, unit prices outperformed houses over the September quarter, reversing the trend seen for the past nine consecutive quarters.”
Ray White Group head of research Vanessa Rader said difficulty in getting projects off the ground in Perth, coupled with high construction costs, had put upwards price pressure on the established housing market.
She anticipated house prices would continue to rise to the end of 2023, but by how much would depend on whether the Reserve Bank lifted interest rates in November.
“WA’s pretty tough when it comes to planning,” she said.
“From conception to completion, or even conception to approval, takes an awful long time, there’s many, many years in between there.
“Nothing can deter from the fact that there is not enough supply coming into the market and WA is still seeing one of the largest levels of population growth as a percentage.”
CoreLogic data shows there are just 10,555 properties listed for sale in Perth, 31.5 per cent less than the same time last year.
Across the capitals, Sydney ($1.58 million) and Brisbane ($848,752) house prices are tracking towards record highs by the end of 2023 while Brisbane ($495,143) and Adelaide ($466,379) are the only cities with record-high unit prices.
Darwin has the most affordable housing in the country with a median of $577,659.
CoreLogic’s head of residential research, Eliza Owen, said as Perth’s population growth surged and monthly rent growth remained high, relatively cheap pockets of the city would become more popular.
Median weekly rents across the dwelling market sat at $604 in September.
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“Perth rents have seen the largest uplift of any capital city rent markets since the onset of the pandemic, at 44.9 per cent,” Owen said.
“For those that work or study in the city centre, rent options are looking increasingly thin, and once relatively unpopular areas may be burgeoning with rental demand from high-income professionals.”
Analysis by CoreLogic showed the lowest house rents within 20 kilometres of the Perth CBD ranged from $491 in Girrawheen to $519 per week in Koondoola.
REIWA chief executive Cath Hart said while the number of homes coming to the market is about 6.3 per cent lower than the same time last year, the number of sales is 16.4 per cent higher, reflecting the strong demand.
“Houses are selling like hotcakes and the number advertised on REIWA hit a 30-year low of 4931 at the end of September, well below the 12,000 that is considered a balanced market.”
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