Realmark founder John Percudani reflects on the economic and market forces shaping Perth’s next phase of growth - from interest rates and affordability to the fundamentals driving long-term stability.
The Perth property market continues to evolve through one of the most intriguing phases in recent memory. Despite national headlines pointing to mixed sentiment, local fundamentals remain resilient, shaped by an interplay of strong population growth, tight supply, and economic confidence.
Supply remains one of the most defining features of the current cycle. New dwelling construction has lagged behind population growth, and while we’re seeing gradual improvement in build activity, the pace of delivery is still well below what’s needed to balance demand. That imbalance continues to underpin both sales and rental markets, sustaining momentum in values despite broader affordability pressures.
Demand, meanwhile, is being driven by enduring confidence in employment and migration. Western Australia continues to record some of the strongest job creation figures in the country, supported by infrastructure investment and the ongoing pull of lifestyle and opportunity. This solid employment base gives buyers and tenants alike the confidence to make housing decisions even as costs rise.
Interest rates remain a central consideration. While the Reserve Bank has paused tightening, the higher-rate environment has become the new normal, reshaping how affordability is perceived rather than halting activity altogether. Buyers have adjusted, lenders are more measured, and sellers are navigating expectations with greater realism.
Affordability, particularly for first-home buyers, continues to be stretched, yet Perth still holds a relative advantage nationally. Even as household costs and living expenses edge upward, median price growth has stayed steady, reflecting underlying strength rather than unsustainable escalation.
Looking ahead, sentiment remains cautiously optimistic. The combination of structural supply constraints, steady population inflows, and a robust employment market suggest that Perth’s property values are more likely to consolidate than retreat. By 2026, the market may well shift toward a phase of moderate growth, underpinned by stability rather than exuberance.
As Perth’s market moves through its next cycle, balance and perspective remain key. The fundamentals continue to point to a market supported by strong employment, population growth, and a manageable level of new supply. Understanding these forces and how they interact is what enables confident decision-making in any market environment.