Every few years the Western Australian property market finds itself staring down another “certain” catastrophe.

This time it’s a proposed Federal Budget. Last time it was interest rates. Before that it was COVID. Before that it was the mining downturn. Before that it was the GFC.

And yet here we are.

Buyers are nervous. That’s undeniable.

Open homes are still busy, but the conversations have changed.
Less “Where do I sign?” and more “What do you think the market will do?”

The honest answer?

Nobody knows.

What we do know is that Perth’s property market has finally started to catch its breath. Listings have increased this year and homes are taking longer to sell than they were a few months ago. According to REIWA, Perth houses were selling in a median of 14 days in May compared to just 9 days in February. That’s still remarkably quick by historical standards, but it does tell us buyers are no longer sprinting quite as hard.

The Federal Budget has undoubtedly added a layer of uncertainty. Investors don’t like uncertainty. Neither do banks, economists, first home buyers, or most couples trying to decide whether now is the right time to move.

But uncertainty doesn’t create houses.

Western Australia still has a fundamental supply problem.

Building costs remain stubbornly high. Labour remains difficult to source. Builders are still working through capacity constraints. Despite thousands of homes under construction, population growth continues to outpace housing delivery. More than 100,000 additional Western Australians need somewhere to live, yet housing completions remain well below what is required.

That matters.

Because while buyers may pause for a few months while they digest the latest political announcement or interest rate movement, population growth doesn’t pause. Migration doesn’t pause. Babies don’t pause. Relationship breakdowns certainly don’t pause.

People still need roofs.

Then there is the elephant in the room that many eastern states commentators continue to underestimate — mining.

Western Australia’s economy remains heavily linked to the resources sector. Every time commodity prices strengthen and mining investment starts flowing again, employment tightens, wages improve and housing demand follows close behind.

History suggests that when WA employment is strong and housing supply is constrained, property prices tend to move in one direction.

Up.

Will prices continue to rise at the extraordinary pace we’ve seen over the past couple of years?

Probably not.

Could we see periods of flat growth while buyers regain confidence?

Absolutely.

Could we see some suburbs go backwards?

Of course.

But a widespread collapse in Perth property prices still seems difficult to reconcile with the reality of a growing population, constrained housing supply and construction costs that continue to make replacement housing expensive. REIWA’s own forecasts continue to point toward further price growth in 2026, although likely at a more measured pace than the market’s recent sprint.

So the market isn’t crashing, it’s simply catching its breath. 

Derek Baston
sales@bastonandco.com
0417 99 23 24