Think Perth has peaked? The fundamentals say otherwise

He said that when assessing a market, the broader cycle over the past decade was what mattered, not just recent price growth.

In recent years, the City of Light has recorded some of the nation’s strongest property price growth, fuelled by tight supply, strong population growth, and rising investor demand.

According to Cotality data for May 2026, Perth’s median dwelling value sat at $1,050,354, compared with $1,282,020 in Sydney and $1,126,149 in Brisbane.

Over the past 12 months, Perth’s dwelling values have risen 26 per cent, outdoing every other capital city.

While Perth values have grown over the past couple of years, the city has experienced a prolonged downturn from 2014 to 2020 after mining dropped, with prices only recently recovering in some areas.

Cotality data showed that since the mining boom, Perth property values fell 15.3 per cent from peak to trough over 61 months.

“When you factor in those six years of decline, Perth’s current position relative to the eastern states looks very different,” Deering said.

Additionally, Deering said when investors compared Perth to the eastern states, the numbers still stacked up strongly.

Cotality data also showed that the city’s gross rental yield has been sitting at 3.6 per cent, compared to 3.2 per cent in Sydney and 3.3 per cent in Brisbane, despite Perth recording stronger annual price growth.

“Perth is still significantly cheaper than Sydney, yields remain comparatively strong, and the underlying supply-demand imbalance hasn’t gone away,” Deering said.

Western Australia also continues to see an imbalance between demand and supply, with Australian Bureau of Statistics data showing the state completed 22,124 dwellings in the year to September 2025, while the population grew by 65,800 people over the same period.

Deering said the market wouldn’t change substantially until stock conditions did, but supply wouldn't suddenly increase, as the building industry was struggling to keep up.

“We’re simply not building enough homes to match demand.”

Deering added that Perth was attracting increasing interest from interstate and overseas buyers who were looking beyond the traditional focus on eastern cities.

While historically, international buyers were mostly focused on Sydney and Melbourne, he said buyers from countries like Singapore, Hong Kong, and Malaysia were becoming more data-driven.

“They’re looking at affordability, rental returns, economic growth, and long-term upside, and Perth is increasingly appearing on their radar.”

Deering said the reason for this was clear, as Western Australia’s economic performance and infrastructure investment were helping to support confidence.

The state recorded an operating surplus of $3.5 billion in 2025-26 for the eighth consecutive time, while committing a record $44.3 billion to infrastructure investment over the next four years.

Meanwhile, unemployment remains low, with more Western Australians in work than ever before, and State Final Demand has grown 27 per cent over the past five years.

“That level of economic activity and investment tends to attract people and capital to a market over time,” Deering said.

“More people and more capital, combined with a supply shortage, is what keeps upward pressure on prices.”

While he recognised that every market had growth limits, he said the factors that would typically signal a correction, such as oversupply, weakening demand, or deteriorating economic conditions, were not currently present.

“The market won’t change until supply catches up with demand. And that’s not something that happens overnight,” Deering concluded.

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