Perth’s property market has delivered a dynamic start to 2025, with the latest data from the March quarter revealing a significant surge in the prices of units, townhouses, and apartments. Meanwhile, after a period of rapid growth, the housing market is showing signs of stabilizing.

The Real Estate Institute of Australia’s (REIA) latest Real Estate Market Facts report highlights a clear trend: buyers are increasingly turning to more affordable housing options, driving strong price growth in the ‘other dwellings’ sector.

Here’s a snapshot of how the Perth market performed in the first quarter of 2025.

Sales Market: A Tale of Two Dwelling Types

The big story this quarter is the outstanding performance of the ‘other dwellings’ market, which includes units, townhouses, and apartments.

The median sale price for these properties in Perth jumped 2.8% over the quarter and a remarkable 19.4% over the past year, reaching $555,000.

According to REIWA President Suzanne Brown, this isn’t a surprise. “Significant growth in house prices over the past couple of years has seen people seek more affordable alternatives when looking to buy a home,” she said. This heightened demand is putting strong upward pressure on prices in this sector.

Despite this growth, Perth remains one of the most affordable capital cities for apartments and units, second only to Darwin.

Key Highlights for ‘Other Dwellings’ (March 2025 Quarter):

• Perth Inner: Up 3.3% to $599,000
• Perth Middle: Up 3.6% to $570,000
• Perth Outer: Up 2.0% to $489,500
• Regional Hotspots: Broome saw an impressive 11.9% quarterly increase, with Albany and Bunbury also recording strong growth.

In contrast, the median house sale price in Perth saw a slight quarterly decline of 1.0% to $790,000. However, it’s crucial to look at the bigger picture – this is still 14.5% higher than the same time last year.

Ms. Brown cautions against viewing this as a market downturn. She explains that a drop in sales in the higher price brackets early in the quarter influenced the overall median. “The conditions underpinning price growth persist,” she noted, citing strong population growth and a steady pipeline of new home completions. “We can expect the Perth median price to increase over the remainder of the year.”

Key Highlights for Houses (March 2025 Quarter):

• Perth Inner: Median price decreased to $1,460,000
• Perth Middle: Median price decreased to $914,500
• Perth Outer: Median price increased 0.8% to $741,000

Perth Rental Market: Signs of Increased Balance

The rental market is also experiencing a shift. The median weekly rent for a two-bedroom ‘other dwelling’ rose by 4.8% over the quarter to $650, now on par with a three-bedroom house.

While rents are still up 8.3% annually for both these property types, the pace of growth is slowing. This is largely due to an increase in rental supply.

Perth’s vacancy rate rose to 2.5% at the end of March. This is a significant increase from the record low of 0.4% a year ago and is considered the lower end of a balanced market.

“New supply has been coming to the market, which has seen the vacancy rate increase,” Ms. Brown stated.

However, the market remains segmented. Desirable suburbs close to the CBD and lifestyle hubs still have vacancy rates below 1%, maintaining strong pressure on rent prices. In contrast, areas with a high concentration of new investment properties may see landlords needing to be more competitive with their pricing.

Key Rental Highlights (March 2025 Quarter):

• Two-Bedroom Other Dwelling Rents: Rose across all Perth metro areas, led by Perth Inner (up 6.1% to $700).
• Three-Bedroom House Rents: Rose in Perth Middle (up 3.4% to $750) and remained stable in the Inner and Outer regions.

What This Means For You

The Perth market is becoming more nuanced. While strong underlying demand continues to support prices, the frantic growth in the housing sector is beginning to moderate. The ‘other dwellings’ market is now stepping into the spotlight, offering fantastic opportunities for both first-home buyers and investors.

For renters, the rise in the vacancy rate is welcome news, offering more choice and a slight easing of the highly competitive conditions seen over the past few years.

Whether you are buying, selling, or leasing, understanding these specific local trends is crucial. As Ms. Brown advises, “it’s important to discuss market conditions with a local agent.”

Thinking of making a move in the Perth property market? Contact our expert team today for tailored advice to help you achieve your property goals in 2025.