30 Aug Perth Property Prices Poised for Growth Amid First Home Buyer Incentives
Perth Property Prices Poised for Growth Amid First Home Buyer Incentives
Perth is rapidly emerging as one of Australia’s most robust property markets, driven by a combination of housing demand, relative affordability, and government-backed incentives for first home buyers. The latest developments indicate a strong upward trajectory for prices in Western Australia’s capital, with analysts and market participants forecasting continued growth into the second half of 2025 and beyond.
Recent policy announcements—including expanded incentives for first home buyers—are injecting further momentum into an already tight market. This, coupled with historically low vacancy rates and constrained housing supply, places Perth in a unique position of strength compared to other capital cities.
As these trends unfold, Perth is drawing heightened attention from property investors, developers, and owner-occupiers alike. Understanding the underlying drivers of the city’s growth is key to identifying strategic opportunities in one of the country’s most resilient residential markets.
A Market on the Move
According to recent reports, Perth has recorded one of the highest growth rates in home prices nationally, with values increasing by more than 20% over the past 12 months. This performance is underpinned by a housing market that has remained comparatively affordable while other capital cities experienced volatility during the previous interest rate tightening cycle.
Several factors are contributing to this surge:
- Supply Shortages: Perth is facing a well-documented undersupply of housing stock, particularly in desirable inner and middle-ring suburbs. Low construction activity over recent years and pandemic-related delays have further constrained availability.
- Population Growth: Western Australia is experiencing strong population gains, led by interstate migration and international arrivals. This population pressure is directly translating into increased housing demand.
- Rental Demand: With vacancy rates hovering around 0.4%, Perth remains one of the tightest rental markets in the country. This has resulted in double-digit rental growth, attracting investor interest and encouraging first home buyers to leave the rental cycle.
- Comparative Affordability: Despite recent growth, Perth’s median dwelling price remains significantly lower than those in Sydney, Melbourne, or Brisbane. This value gap is making Perth increasingly attractive to buyers priced out of the east coast capitals.
Expanded First Home Buyer Incentives Fuel Demand
The Western Australian Government recently announced an expansion of its First Home Owner Grant (FHOG) and stamp duty concessions. These changes are expected to bring thousands of first home buyers into the market, particularly those targeting new builds or off-the-plan purchases.
Key updates include:
- An increase in the stamp duty threshold, allowing more buyers to access full or partial exemptions.
- Continuation of the $10,000 First Home Owner Grant for new home purchases or construction.
- Streamlined processes to improve application turnaround times and fund access.
These initiatives are designed to stimulate new housing construction and ease rental pressures by encouraging more people into home ownership. However, in a market already marked by low supply, the surge in buyer demand may further elevate property prices—particularly in outer suburban growth corridors and greenfield estates.
Key Suburbs and Growth Areas to Watch
As demand intensifies, several suburbs in Greater Perth are emerging as high-interest zones for both first home buyers and investors. These areas combine accessibility, affordability, and future infrastructure planning—key indicators of potential capital growth and rental return.
1. Baldivis
Located in Perth’s southern corridor, Baldivis offers a range of house and land packages with entry-level pricing and proximity to schools, shops, and transport. The suburb has become a hot spot for first home buyers and young families.
2. Brabham and Ellenbrook
These northeastern suburbs are part of the Metronet expansion, which is improving connectivity to the CBD. As transport infrastructure is delivered, Brabham and Ellenbrook are experiencing significant interest for new builds and off-the-plan opportunities.
3. Alkimos
In the far north, Alkimos combines coastal lifestyle with master-planned community appeal. It’s benefiting from government development incentives and new amenities, including the future Alkimos Central business hub.
4. Armadale and Forrestdale
In the southeast, these more affordable areas are attracting both investors and first-time buyers. Infrastructure upgrades and rezoning activity are also creating opportunities for medium-density developments.
5. Wattle Grove and High Wycombe
Located near the Perth Airport and future industrial precincts, these suburbs are seeing increased tenant demand and consistent capital appreciation, driven by employment access and suburban amenity.
Implications for Property Investors
The Perth market is being shaped by overlapping forces: government incentives, population growth, undersupplied housing, and a strong rental market. While these are positive signs, they also bring complexity—particularly for investors seeking to identify optimal locations for capital growth and yield.
Some strategic considerations include:
- Timing and Supply: The influx of first home buyer demand may stretch existing supply further. Investors entering the market now may benefit from the upward pressure on prices but should remain attentive to future supply pipelines and construction delivery times.
- Rental Yield Potential: In suburbs with tight vacancy rates and improving infrastructure, the rental return outlook remains favourable. Areas near new train stations, employment nodes, or educational institutions are particularly worth monitoring.
- Infrastructure Investment: The WA Government’s Metronet program, along with health and education infrastructure projects, is shaping long-term growth zones. Investors often see strong results in locations aligned with these developments.
- Affordability Advantage: Perth continues to offer a low barrier to entry compared to other capitals. For investors looking to diversify geographically, the city’s affordability and momentum present a compelling value proposition.
The Long-Term Outlook
Perth’s trajectory is reflective of a maturing capital city market. While short-term gains are currently in focus due to incentive-driven demand, the longer-term outlook is equally promising—supported by population growth, economic diversification, and infrastructure delivery.
Moreover, the government’s pro-growth stance and commitment to housing supply solutions indicate that Perth will continue to attract new residents and businesses in the years ahead. For investors and buyers alike, the key lies in identifying locations that not only perform in the current cycle but are well-positioned for future demand.
Conclusion
Perth’s property market is experiencing a powerful combination of affordability, housing demand, and policy-driven buyer activity. With expanded first home buyer incentives now in effect, the market is expected to see heightened competition in the months ahead—particularly in suburbs that offer strong lifestyle appeal and growth infrastructure.
For property investors and industry stakeholders, Perth presents one of the most dynamic and opportunity-rich environments in Australia’s current real estate landscape. As the market continues to evolve, those who align their strategies with data, infrastructure trends, and localised demand patterns may find themselves well-positioned for long-term success.