Perth’s housing market is showing clear signs of easing momentum, with homes now taking nearly twice as long to sell compared to earlier in the year, even as prices continue to rise and listings lift back above 5,000.
New data from the REIWA shows the median time to sell a house rose to 14 days in May, up from nine days in February. Units increased from eight days to 13 days over the same period.
REIWA President Suzanne Brown said the shift reflects a transition away from the ultra-tight conditions seen earlier in the year.
“The March quarter was characterised by lower-than-average new listings and very strong demand, which saw properties being snapped up in just over a week,” she said.
“Over April and May we have seen over 1,000 new listings per week, which has contributed to the easing of the market.”
Ms Brown said higher interest rates and improved choice for buyers were also changing behaviour.
“There has also been a shift in buyer sentiment. While the increase in new listings has given buyers more choice and more time to make a decision, they are also dealing with the effects of three consecutive interest rate rises. This impacts borrowing power and also affordability once you have a mortgage. In response to this, buyers are being more discerning.”
Despite the slowdown in speed, prices continued to rise in May. The median house price increased 2.2 per cent to $920,000, while the median unit price rose 2.3 per cent to $660,000.
On an annual basis, growth remains strong, with houses up 16.5 per cent and units up 22 per cent and Ms Brown said the easing in pace should not be misinterpreted as a market slump.
“A slowdown in growth and a change from just over one week to sell a property to two weeks do not represent a downturn.”
She added that conditions remain highly responsive to supply changes, with past cycles showing momentum can quickly return if listings tighten again.
“However, the market was in a similar place at this time last year, and a drop in new listings in the second half of the year, combined with ongoing strong demand, saw frenzied conditions return.”
Ms Brown said the current environment represents a shift towards more balanced conditions.
“Conditions vary from suburb to suburb… I think a more balanced market would be welcomed by industry and the community.”
Listings climb back above 5,000
Supply has lifted materially, with active listings reaching 5,137 at the end of May — up 16 per cent on April and 20.7 per cent higher than a year earlier.
It is the first time listings have exceeded 5,000 at month-end since November 2024, signalling a recovery in available stock after a prolonged tight period.
Suburb-level conditions remain uneven
While overall momentum has eased, performance continues to vary sharply by suburb.
House selling speeds were fastest in Nollamara and Coolbellup (six days), followed by Subiaco, Hillarys, Forrestfield, Dianella and Iluka (seven days), and Yokine, Woodvale and Lesmurdie (eight days).
For units, Tuart Hill led at five days, with Cockburn Central at six, and Wembley, Yokine and Maylands all recording sub-10-day medians.
Price growth also remained broad-based across the city. Among houses, Harrisdale and Landsdale led gains, both up 4.9 per cent, followed by Bassendean (up 4.5 per cent), Southern River (up 2.8 per cent) and Subiaco (up 2.7 per cent).
Unit markets saw the strongest growth in Rockingham (up 2.6 per cent), Innaloo (1.9 per cent), Maylands (1.7 per cent), Rivervale (1.6 per cent) and Perth (1.6 per cent).
Rental market stabilises after strong growth
Perth’s rental market showed signs of stabilisation in May after a period of strong gains.
The median weekly rent for houses remained unchanged at $750, while units held steady at $700. The median dwelling rent edged up 1.4 per cent to $730 per week.
Ms Brown said investors are reassessing their positions following policy changes, including adjustments to capital gains tax and negative gearing.
“Investors are evaluating their positions now they have some clarity about the changes to the capital gains tax discount and negative gearing,” she said.
“As negative gearing is grandfathered, those investors whose property is negatively geared are likely to hold onto their investment, which will not free up a home for someone to buy, However, it will ensure a rental property remains in the market.”
She warned that policy changes could influence investor behaviour in ways that affect both rental supply and affordability.
“Of great concern for the rental market is modelling released last week by the REIA. This showed rent prices will rise by $9 per week over the next four years, as opposed to the government’s claim of a modest $2 per week lift, while new housing starts will fall by over 8,700 dwellings.”
Ms Brown said increasing supply remains the key challenge: “If we want to improve outcomes for renters we need to increase rental supply. To do that we need an environment that encourages more investment, not deters it.”