House prices are on track to surpass $1 million by the end of 2025. While the pace of growth is expected to ease slightly from recent highs, prices are still projected to rise at a solid rate of 5% in 2026.

The city’s momentum remains underpinned by a combination of lower interest rates, strong income growth, and first-home buyer support. Perth households are also benefitting from comparatively lower mortgage burdens, meaning housing affordability is less likely to act as a constraint on future price growth (figure 9). Despite the sharp rise in home prices since 2020, mortgage repayments as a share of income remain below those seen in most other capitals.

Unit prices are expected to grow at a slower pace, though more quickly than for houses, with the median projected to reach a record $613,000 – about $52,000 higher than today. Unit prices will continue to be supported by affordability pressures shifting demand towards the more affordable unit market, while ongoing construction cost challenges will continue to limit the supply of new units

House rent growth is expected to rise at a similar pace to next year, while unit rent growth is likely to strengthen. House rents are projected to reach $731 per week, while unit rents are forecast to rise to $631 per week. Low vacancy rates, rising household incomes and sustained demand for more affordable housing options will continue to support unit rents. Vacancy rates remain among the lowest across the capitals, highlighting the persistent imbalance between supply and demand (figure 10).

Perth’s housing and rental markets are also underpinned by a resilient labour market. So far in 2025, Western Australia’s unemployment rate has averaged lower than most other states and territories, behind only Tasmania and the ACT. This reflects the state’s strong economic fundamentals and continued demand for housing.

However, slower population growth and worsening affordability will limit the pace of further rent increases. 

Source: Copyright © 2025 Australian Property Monitors Pty Ltd trading as Domain Insight (DI). This information is published and compiled by DI and in developing it DI also relies on the information supplied by a number of external sources.

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