In Episode 79 of The Purposeful Investor Podcast, David Andrew and Aden Wilkins sat down with Rowan Pow, Director of Verve Buyers Agency, to unpack what is really happening in the Perth property market.
After several years of rapid growth, the market is changing. Buyers have more choice, investor activity has fallen, and competition is becoming more selective. Yet despite the shift in sentiment, Perth continues to face a structural housing shortage.
KEY TAKEAWAYS
- Perth’s median house price has increased from approximately $840,000 in 2021 to around $1.35 million today.
- Population growth remains well above the level required to keep housing demand balanced.
- Buyers are becoming more selective and focusing on quality rather than speed.
- Investor activity has declined significantly following Federal Budget changes.
- Quality properties remain highly sought after.
- More families are helping children enter the property market.
- Location continues to be the most important driver of long-term value.
FROM “JUST GET IN” TO “GET IT RIGHT”
For much of the last four years, Perth buyers operated under one strategy: move quickly.
With stock levels at historic lows and intense competition across most suburbs, many buyers felt they had little choice but to secure whatever they could.
Today that psychology is changing.
While the market remains competitive, buyers now have more time to undertake due diligence, compare options, and focus on quality. Rowan believes this is a positive development because it encourages buyers to think more critically about the homes they are purchasing.
PERTH STILL HAS A HOUSING SHORTAGE
Although more listings have returned to the market, housing demand continues to outpace supply.
A key driver remains population growth. Perth’s population is growing significantly faster than the natural replacement rate required to maintain housing balance.
The result is a market where supply has improved, but demand remains structurally strong.
THE CASCADE EFFECT PUSHING BUYERS INTO NEW SUBURBS
One trend Rowan is seeing is what he describes as a cascade effect.
When buyers are unable to secure property in their preferred suburb, they move to neighbouring areas. This pushes demand into adjacent locations, increasing prices and competition across a broader section of the market.
Over time this creates growth opportunities in suburbs that may previously have sat outside buyers’ consideration sets.
WHY LOCATION STILL WINS
Despite all of the market noise, one principle continues to hold true.
Location matters.
Rowan highlighted several factors buyers should focus on:
- Location and accessibility
- School catchments
- Natural light and orientation
- Functional floor plans
- Future resale appeal
- Development and zoning risks
Many buyers ignored these fundamentals during the height of the market. As conditions become more balanced, these attributes are becoming increasingly important again.
WHAT THE FEDERAL BUDGET CHANGED
One of the most significant discussion points was the impact of recent Federal Budget changes.
According to Rowan’s observations, investor activity has reduced materially. Where buyer pools previously consisted of roughly equal numbers of investors and owner-occupiers, owner-occupiers now dominate many market segments.
This shift has reduced competition in some parts of the market while increasing focus on homes intended for long-term owner occupation.
WHY BUILDING HAS BECOME MORE CHALLENGING
Another consequence of changing market conditions is the growing cost and complexity of building a new home.
Many families who previously planned to knock down and rebuild are reassessing their options.
Instead, some are choosing to purchase completed homes or lightly renovated properties, avoiding the uncertainty, holding costs and construction expenses associated with a new build.
THE RETURN OF SUBJECT-TO-SALE OFFERS
For the first time in several years, subject-to-sale offers are starting to reappear.
This reflects a market becoming slightly less competitive while allowing more buyers flexibility to upgrade or downsize.
Cash buyers continue to hold a significant advantage, but the return of these conditions may create more opportunities for families needing to coordinate simultaneous property transactions.
PARENTS ARE PLAYING A BIGGER ROLE
The podcast also explored the growing role of parents and grandparents in helping younger family members enter the property market.
Rather than gifting large sums of money, many families are using guarantor arrangements backed by home equity. This can help younger buyers secure better quality properties earlier while maintaining a long-term ownership strategy.
WHAT DOES THE NEXT 12 MONTHS LOOK LIKE?
Rowan expects listings to continue increasing, although much of the additional stock may come from less desirable segments of the market.
Quality homes in quality locations are likely to remain scarce.
Days on market may increase slightly, giving buyers more breathing room, but Perth is still expected to remain a seller’s market overall.
THE BOTTOM LINE
The Perth property market is no longer behaving the way it did during the frenzy of the past few years.
Buyers have more time, more choice and more opportunity to focus on quality.
But the fundamentals remain intact. Strong population growth, limited housing supply, and ongoing demand continue to support the market.
For buyers, the lesson is simple: focus less on the noise and more on the fundamentals.
Location. Quality. Long-term thinking.
Those principles remain as valuable today as ever.
Watch the full episode on the Purposeful Investor YouTube channel.
