Out of the slump, on the up!

Perth, Western Australia

Perth is the capital and the largest city of the Australian state of Western Australia (WA). With an estimated population of over 2 million (Australia Bureau of Statistic, 2017), Perth is also the fourth-most populous city in Australia.

As the capital city of one of the world’s most significant mining regions, Perth is rapidly growing in both population and economic prosperity.

Perth's proximity to greater Asia opens great potential for investors in energy, minerals, tourism and hospitality, education, agriculture and food.

Perth is in the midst of an exciting period of expansion and new developments. The large-scale capital work projects throughout the city and surrounding areas means Perth will change dramatically over the next ten years, better reflecting the growing global importance of the city.

Perth Property Market Condition

While big markets like Melbourne and Sydney are starting to fall back in terms of settled sales, the once-flailing market of Perth is beginning to build itself back up.

In Perth, there have been very few new apartment projects under construction in the past year and this will lead to a significant shortage of supply in 2019 and beyond. When there is a supply shortage, we usually see increases in price, however expect these gains to be moderate due to the limited wage growth in Western Australia.

The key drivers for the recovery have been improving economic conditions and a major slow-down in new housing construction. Improving economic conditions are giving people greater confidence to buy a property while the slowdown in new housing construction has meant that the major oversupply caused by the building boom between 2012 and 2016 is being absorbed by the market.

The Suburbs Are Growing

Recent Real Estate Institute of Western Australia (REIWA) figures show that 40% of suburbs across the Perth region have a limited supply of homes for sale. On average, suburbs across Perth have 1.3% of properties listed for sale. However, there are 95 suburbs which have a ratio below 1.3%.

"Established suburbs with current low levels of stock are generally located close to the City such as Mount Hawthorn, Leeming and Bullcreek all of which have just 0.6% of properties listed for sale"

While the property prices in the city may have dipped by 2.1% in the past year, top end suburbs such as Bicton, Nedlands, Subiaco and Como have experienced some of the highest level of growth. Taking Como as an example, the median price of homes sold in Como in the three months leading up to June 2018 surged 20.3% to $962,500.

Perth house price slump finally bottoms out

Quoting from Hayden Groves, President of the Real Estate Institute of Western Australia, Perth market had by all bottomed out, however recovery may be slow but healthy. "The economy is improving all the time, we have bright prospects on the jobs front with some mining interests recommencing and pulling a lot more jobs back into Western Australia" he said.

He further added, "The rental market has already recovered from its lows and that's been in recovery for more than 12 months now, and that's the first place that we look to see markets improvement."

The vacancy rate in Perth has dropped to 4.5% in August 2018, with leasing activities rising 17%, equivalent to a total of 4,805 dwellings leased out over the course of the month.


House Price Index June 2004 - June 2018

House Price Index June 2004 - June 2018

Perth is home to almost 80% of WA’s population, making it the most significant segment of the state’s property market. While house prices in Perth are still declining in annual terms, the rate of decline is slowing and nearing zero. Unit prices, on the other hand, are now increasing — up 1.7% over the year up to June 2018— but are still below their 2014 peak.

Property Advertisement Views on 2014 - 2018

Property Advertisement Views on 2014 - 2018's data on the number of views of online property listings on Domain’s website and apps, which is a timely sign of buyer interest, also points to a pick-up in the WA property market. The graph above shows an increase in the total number of ad views for WA's regions.

Factors Driving Growth In Perth

1. Strong Fundamental - Top City Of The World

Perth has been rated in the Top 10 most liveable cities in the world for the past 12 years (EIU, 2016) and is now Australia’s most affordable Australian Capital City (EIU, 2017). With a 5 hour flight time to Singapore and a shared timezone with 60% of the World’s population, Perth is set to become Australia’s Asian Pacific Capital.

2. Major Transformation In Central Perth

Central Perth is transforming through over $11.9 billion in government led investment in city-shaping projects including Elizabeth Quay, Perth City Link, WA Museum, Riverside and Perth Stadium. These projects have connected the city to Swan River. Not only that, it will connect the cultural and entertainment precinct of Northbridge with the central area, continuing to add life and vitality to Perth.

3. Improving Labour Market

Job Vacancy Trend - Total & Private Sector

Job Vacancy Trend - Total & Private Sector

Job prospects and economic conditions are improving in Western Australia. Job vacancies in WA are at their highest levels since May 2014. The availability of jobs will lead to an increase of economic activities, resulting in higher demand for rental properties.

4. Outlook For Mining Sector Has Improved

Conditions in the mining industry are improving. Bulk commodity prices are currently 25% higher than the average of 2016. The big miners have all announced new iron ore mines or are close to making decisions on new investment. BHP approved the ~$4.5b South Flank mine in June and Fortescue Metals Group approved the ~$1.7 billion Eliwana iron ore mine in May. Rio Tinto is expected to give final approval to the ~$2.7 billion Koodaideri mine later this year. In addition to the activity in the iron ore sector, lithium mining and processing is also taking off, while LNG (liquefied natural gas) exports are also growing strongly.

5. Population Growth Picks Up

WA Population Trend and Forecast

WA Population Trend and Forecast

Population growth in Western Australia is on the rebound since its lowest point of 0.6% in 2016. In Sept 2017, the population growth rate published by Australia Bureau of Statistic rose to 0.78% and is forecasted to reach 1.8% by year 2020. Population growth has been driven by a slight pick-up in net overseas migration into Western Australia and a levelling out in the net outflow of people to other states

Major Developments in Perth. Source:

Major Developments in Perth. Source:

Bird eye view of Elizabeth Quay

Bird eye view of Elizabeth Quay

An Artist Impression of Riverside

An Artist Impression of Riverside

Metronet Train Network

Metronet Train Network

Major Projects In Perth

Elizabeth Quay

Elizabeth Quay is a waterfront mixed-use development project in the Perth central business district, facing the iconic Swan River. Completed facilities are projected to include 1,700 residential apartments, 150,000 square metres of office space and 39,000 square metres of retail space. Among these are The Towers (Residence) and The Ritz-Carlton (Hotel) as the centerpieces of this iconic development, both developed by Far East Consortium.

Perth City Link

One of the most ambitious projects in the city, Perth City Link will reconnect the CBD with Northbridge for the first time in 100 years, delivering improved access and connectivity. The project will also create housing for more than 3000 new residents, and space for 13,350 workers in 244,000 sqm of new commercial and retail space.

Riverside (East Perth)

Stretching from Burswood Peninsula and Perth Stadium across the river to East Perth, more than 100 hectares is being revamped, filling in areas around current landmarks like the WACA and Queens Garden. In the plan are a mix of apartments and townhouses, public walkways, cycle paths and even a man-made beach.

New WA Museum

The new Western Australia Museum is expected to complete by 2020, following a $428.3 million redevelopment including restoration works to heritage buildings like the Old Perth Goal. Currently the WA museum is the biggest museum redevelopment in the southern hemisphere. It will include a brand new gallery space, new exhibitions, public art and a central energy plant that will reduce energy consumption and emissions in the Perth Cultural Center by up to 40% by 2020.


METRONET is a long term transportation plan to connect suburbs, reduce road congestion and meet Perth's future growth needs. This is Perth’s most ambitious program of rail projects and Stage One will deliver approximately 72 kilometers of new passenger rail and up to 18 new stations.


The redevelopment of the Midland will see the creation of shops, restaurants, bars, parks and lakes, and a large public space called Railway Square with major health facilities including the Curtin Medical University. The entire redevelopment will feature 7000 new dwellings and 157,000sqm of commercial, office and retail space.

What's Next For Perth?

A commentary published by Ronald Chan, the Director and Chief Operating Offer of Finbar Group Limited very well summarized the state of the Perth property market:

The data for Perth shows the bottoming of the market tapering off in 2016 in terms of annual price growth and steadying. Of course, these macro numbers are driven by certain characteristics – the key for Perth being the outer metropolitan areas dragging the averages down. That’s no surprise given the past decline in mining investment and jobs.

Changes are occurring, including the continuing year-on-year growth of first homebuyers and the strength of the owner-occupier market reflecting more discerning buyers who look to attractive new developments with an attention to detail. This flight for quality is set to become a stronger trend as buyers continue to further educate themselves and better understand what key characteristics are important to them.

From a wider perspective, Perth’s link to the resources industry is becoming more and more a good news story. The mining companies are announcing the launch of new large-scale projects and, while the impacts can take some time to be felt in the wider economy, they are coming over the horizon. BHP announced several weeks ago that its South Flank project was to proceed, which will see $2.9 billion in capital expenditure.

Major Western Australian and Federal Government infrastructure projects are also kicking off, with $1.2 billion for Metronet and $2.3 billion in road and rail projects announced in the respective 2018 budgets.


This is a Shorthand story for reviewPublished stories don't show this section.


This feature is not available in landscape. Please rotate your device.


More than 4 characters is required
Name must contain only letters, hyphens, apostrophes, full-stops and spaces
Wait, that does not look like a valid email address!
Your feedback was sent to the story owner.
There is been an issue with submitting your feedback.


This feature is not available in landscape. Please rotate your device.