prices to grow up

House prices to grow up to 10 per cent in 2025

Perth property prices are forecast to grow by up to 10 per cent in 2025, according to the latest quarterly property market update from REIWA.

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“Perth’s median house sale price recorded 24.2 per cent growth in 2024, with the median house sale price rising from $600,000 at the end of 2023 to $745,000 in December 2024,” REIWA CEO Cath Hart said.

“The median unit price increased 21.4 per cent to $500,000 over the same period, up from $412,000.

“The median house and unit sale prices are expected to grow in 2025, but at a slower rate than 2024. Based on current conditions, REIWA is expecting between five and 10 per cent growth.”

Perth’s property market closed 2024 on a high note, with both house and unit median sale prices reaching record levels. The median house price was 36.7 per cent higher than its previous peak of $545,000 in 2014, while the median unit price, which surpassed its 2014 peak of $450,000 in July, ended the year 11.1 per cent higher.

REIWA CEO Cath Hart noted that while moderate growth is anticipated in 2025, market activity in the first half of the year could be influenced by the state and federal elections, as well as fluctuations in interest rates.

“We know market activity often slows in the lead up to elections as buyers and sellers wait to see the outcome. This is especially so when housing is one of the key policy areas — as will be the case in both elections,” she said.

“The ongoing debate over when interest rates will be cut is currently causing some hesitancy in the market. Should interest rates decline in the coming months we are likely to see market activity increase.”

Ms Hart highlighted that despite discussions of falling prices and a shift to buyer’s markets on the east coast, Perth’s conditions remain favourable for sellers, with further price growth anticipated.

“While the rate of price growth has slowed in the past couple of months, the underlying market fundamentals remain strong,” she said.

“This includes strong population growth, with WA recording 2.8 per cent growth in the year to June 2024, low unemployment and a strong economy.

“While some of the urgency seen in 2024 has eased slightly, demand for established housing remains high, with properties still selling quickly.

“However, rising prices mean affordability is likely to become a greater focus for buyers in 2025 and demand will remain strong for affordable suburbs and properties.

“Demand for units, which are generally more affordable entry points to the market than houses, is also likely to remain strong.”

Perth rental market:

The Perth rental market experienced some easing in 2024, driven by changes in supply and demand dynamics.

“After several years of strong growth, rent prices experienced periods of stability in 2024,” Ms Hart said.

“The vacancy rate rose from the record low of 0.4 per cent recorded in March, settling at 1.9 per cent at the end of the year.

“This is a result of changes to supply and demand.

“On the demand side, people adjusted to rising rent prices and the difficulty finding a property by seeking cheaper and smaller rentals. We also saw an increase in the number of tenants per household. People also remained in or returned to the family home, or bought a home, to avoid the challenges of renting.

“We also saw new supply come to the market as a result of completed investor-owned new builds. In addition, some tenants finally had their new homes completed and moved out of their rental, which freed up some existing supply.”

While the Perth rental market eased over 2024, rent prices continued to set new records. The median dwelling rent reached a record high of $650 per week in April and remained stable for the rest of the year, marking an 8.3 per cent increase compared to the end of 2023. The median weekly house rent also hit a record $670 by the close of 2024, representing a 3.1 per cent rise from the September quarter and an 8.1 per cent year-on-year increase.

Similarly, the median weekly unit rent climbed to a new high of $650, reflecting a 14.0 per cent growth over the year and an 8.3 per cent increase since the September quarter. According to REIWA CEO Cath Hart, while further rent price growth is anticipated in 2025, the rate of increase is expected to moderate compared to 2024.

“In the Perth rental market, we are likely to see more periods of rent price stability,” she said.

“We expect the pressure in the rental market to continue to ease as more investor-owned new builds currently under construction are completed. However, with Eastern States investor activity declining, we are not expecting a surge in new supply towards the latter part of the year. 

“With the changes seen in 2024, the vacancy rate is likely to continue its upward trend and we should reach a more balanced market sometime in 2025.

“The greatest demand for rental properties is likely to be for homes closer to the CBD, lifestyle hubs and key transport infrastructure. Areas on the outskirts of Perth, particularly where there is a lot of new supply, may see rent price growth soften.”

Regional WA:

The median house sale price growth in 2025 is expected to vary across Perth’s regions, with the southern centres predicted to experience the strongest growth. Local employment opportunities, population growth, and the availability of new housing supply will remain critical factors influencing market activity in regional centres, driving demand and shaping property trends throughout the year.

“Bunbury was the top performer in 2025, with a 27.3 per cent increase in its median house price,” Ms Hart said.

“A number of factors drove price growth in the area. Bunbury has good employment opportunities, while improving medical facilities and schools have helped retain people who move there, making it far less transient.

“The Busselton airport has been a game changer. It means people no longer have to live where they work, and many FIFO families have moved to Bunbury to enjoy a South West lifestyle. It is also very affordable, particularly when compared with nearby Busselton and Dunsborough.

“These drivers are likely to continue into 2025, and the Bunbury regional centre could see 10 to 15 per cent growth.”

Regional centres such as Albany and Geraldton are projected to experience significant growth, with house sale prices expected to rise by 10 to 15 per cent over the year. Meanwhile, Broome, Busselton, and Esperance also show promising potential, with anticipated growth in the range of five to 10 per cent.

“Every market is different, with different conditions,” Ms Hart said.

“For example, Broome can be very seasonal and median prices fluctuate over the year. Busselton saw very strong growth in 2024, but its median house sale price is currently $860,000. It may reach an affordability ceiling over 2025 – our members report potential buyers are already looking to neighbouring areas, like Bunbury, for more affordable housing options.”

Kalgoorlie, Karratha, and Port Hedland are anticipated to experience more modest house sale price growth, likely up to five per cent. Rent price growth across regional centres is also expected to vary throughout the year, driven by local supply and demand, employment opportunities, and population trends.

“Towards the end of 2024, some regional rental markets showed signs of easing. Others have the potential for more growth and, as with Perth, the rate of growth is likely to slow over 2025,” Ms Hart said.

“The regional centres likely to see the most growth are Albany, Busselton, Esperance and Geraldton. Stability and declines are possible in Karratha and Port Hedland.

“As conditions vary across WA, my advice is to speak to local REIWA agents to get an on-the-ground update of market activity.”