The latest Housing Affordability Report from the Real Estate Institute of Australia (REIA) has been released, and it paints a fascinating picture of the Western Australian property market.
While strong price growth in the first half of the year has led to a slight decline in affordability, the headline story remains incredibly positive: WA is still the most affordable state in the nation to buy a home.
This report gives us a clear look at the trends from the June 2025 quarter and, importantly, helps us see what’s on the horizon for buyers and renters. Let’s break it down.
Home Ownership: How We Compare
In the June quarter, the average WA family needed to use 41.2% of their income to meet mortgage repayments. This is a small increase of 0.4 percentage points from the March quarter.
The reason for this is simple: Perth’s property prices have been growing strongly. This means buyers are taking out larger loans, and even though interest rates were cut by 0.25% in May, it wasn’t enough to completely offset the rise in average loan sizes.
The National Perspective Puts WA in the Lead
This is where the story gets really compelling. While our affordability has tightened slightly, a look across the country shows just how fortunate we are in WA.
- WA: 41.2% of income needed for mortgage
- National Average: 47.7%
- New South Wales (least affordable): A staggering 56.4%
This data confirms that the dream of home ownership is far more accessible here than in the eastern states, making WA a standout for value and opportunity.
Spotlight on First Home Buyers: A Game-Changer is Coming
First home buyer activity was solid in the June quarter, with over 3,600 loans issued. However, we are expecting this number to surge in the coming months.
The June quarter data is a snapshot in time, and two major events have happened since then that will significantly boost first home buyers:
- The August RBA Rate Cut: Lower interest rates will provide more borrowing power and confidence.
- Fast-Tracked Home Guarantee Scheme: From 1 October 2025, the Federal Government is expanding its support for first home buyers. The changes are huge: income limits are being removed, property price caps are increasing, and the number of available places is now unlimited.
This is arguably the most significant support package for first home buyers in years and will open the door for many more West Australians to enter the market.
The Rental Market: Signs of Stabilisation
For tenants, the report brings some welcome news. After several years of sharp increases, rent price growth is slowing down.
Rental affordability declined only marginally, with 24.1% of family income required to meet rent payments. This slight increase reflects a market that is beginning to stabilise. While we may see further modest rent increases through the rest of 2025, the period of rapid, unsustainable growth appears to be behind us.
What This Means for You
- For Buyers & Sellers: The report confirms that buyer demand remains robust, which continues to support strong property values. For sellers, this is excellent news. For buyers, it highlights that while prices are rising, WA remains the land of opportunity in Australia.
- For First Home Buyers: The time to prepare is now. The upcoming changes to the Home Guarantee Scheme are a game-changer. We strongly encourage you to get your finances in order and speak to a professional to see how you can take advantage of this incredible opportunity from October 1st.
- For Investors & Landlords: The rental market remains strong but is showing signs of becoming more balanced and sustainable. This stability is a positive sign for long-term investment, ensuring consistent demand and a healthy return.
The property market is always evolving. Understanding the data is key to making a successful move. Whether you’re an aspiring first home buyer, a seller looking to capitalise on current conditions, or an investor seeking clarity, our team is here to help you navigate the market with confidence. Contact us today!
