Data gurus, CoreLogic released their September quarter Home Value Index report earlier this week finding that whilst national house prices continue to rise, the rate of growth is beginning to slow. Perth is now leading the nation for house price gains returning 1.6 percent growth in September, 4.7 percent for the quarter and a whopping 24.1 percent over the past twelve months.
In comparison, the east coast cities of Hobart, Canberra and Melbourne all went backwards last quarter with Melbourne leading the retreat by 1.1 percent. Annually, house prices in Melbourne have shrunk 1.4 percent. Sydney’s house prices continue to grow, albeit at an anaemic rate, up 0.5 percent last quarter and 4.5 percent for the year. Adelaide is running second behind Perth annually, expanding its dwelling price by 14.8 percent to sit at a median of $802,075. As at 30 September, Perth’s median dwelling value was $791,184, nudging ahead of Melbourne $777,390, but still behind Brisbane ($881,091) and Canberra ($844,882). Sydney remains the most expensive capital with its latest dwelling value at $1,188,912.
not yet at the peak of this cycle
The slowing rate of growth for the Perth market has prompted some commentators to deduce that our market is nearing its peak. The data shows the pace of gains has slowed, down from the 6.2 percent gains for the June quarter and 5.6 percent for the March quarter. However, contextually, gains of around 5 percent for any quarter are significant and unsustainable longer term. Market prices cannot sustain growth of 20-plus percent annually for very long. Our local property market is still catching up on our ‘lost decade’ of flaccid price gains for the period 2010 to 2020.
I anticipate local prices will reach a median of $875,000 before stabilising in that mid to high $800,000 range. By then (perhaps in a year or so), Perth’s median dwelling value should be in the top three in Australia, behind Sydney, Canberra and on-par with Brisbane.
Meanwhile, stock levels are beginning to rise. The flow of listings to market is increasing, tracking 3.2 percent higher than a year ago nationally. Locally, supply has begun to creep forward with reiwa.com reporting 4,054 property listings this week – up from 3,637 properties listed four weeks earlier. Fremantle’s median house price should continue to increase over the next 12 months albeit at a slowing pace. Growth of 8 to 12 percent over the next four quarters is anticipated with a median house price of around $1,320,000 as at September 2025, up from its current $1,200,000 median.
The slowing of market price gains can be attributed to deteriorating housing affordability. Slack economic growth, high inflation, cost-of-living pressures, borrowing costs and flat wages feed into slowing house price growth. Property priced in the lower quartiles have gained 12.4 percent over the past twelve months nationally, compared to a 3.8 percent gain for higher valued homes.
Market indicators demonstrate Perth’s property market is in its early stages of stabilising. Median rents have not changed in three months, stock levels are on the rise and value gains are slowing. We are not yet at the peak of this cycle and there’s no evidence to suggest prices will fall in any meaningful way once the price summit is reached.