Best suburbs to invest in Perth 2025

Perth has been Australia's star performer of 2024, experiencing remarkable levels of growth in a year where a number of other markets have started to struggle. It's brought especially strong interest from investors, along with overseas and interstate migrants. As a result, it's an exciting time for property investment in Perth.

If you want to buy a house in Perth or thinking of selling your property there, this article can help. Read on for an overview of the latest stats and expert insights on how the Perth property market performed in 2024, and how it is predicted to perform in 2025.

It’s also worth bearing in mind that there isn’t a single ‘housing market’ and performance can vary between suburbs in the same city - which is why you need to make sure your research reflects this.

Let’s start by looking at how the Perth property market has performed over this year.

What did the property market in Perth look like in 2024?

In 2024, the Perth property market stood out as the strongest-performing capital city in Australia, continuing its impressive run of growth despite ongoing affordability challenges across the country. 

According to CoreLogic’s January 2025 HVI report, Perth’s dwelling values surged by +19.1 per cent over the year, the highest growth recorded among the capitals. The city’s rapid price appreciation was driven by persistently high demand, a tight supply of available properties, and strong economic conditions.

Low stock levels remained a key theme throughout the year, with listings continuing to trend well below historical averages, keeping competition among buyers elevated. At the same time, the city’s rental market grew increasingly competitive, with Perth’s residential vacancy rate finding a bottom around 1.0 per cent before rising to 1.8 per cent as of November 2024, according to SQM Research. This extreme tightness in the rental sector has seen gross rental yields in Perth continue to outperform much of the country, making it an attractive proposition for property investors.

A surge in population growth has also played a role in Perth’s booming market. Western Australia’s expanding economy, bolstered by its resources sector and job market, has continued to draw both interstate and international migration, further fueling housing demand. This combination of factors led to sustained price growth across both the housing and unit sectors, solidifying Perth’s reputation as a standout market in 2024.

With conditions still favouring sellers and rental returns remaining strong, the Perth property market has become one of the most robust and resilient in the nation. However, affordability constraints and high interest rates may lead to a slower pace of growth moving into 2025.

Perth property price predictions 2025

Westpac has forecasted the Perth property market to rise +4.0 per cent in 2025, a sharp slowdown from the near-20 per cent growth seen in 2024. They note that the "Extreme price surge has cleaned out any pre-COVID affordability advantage" and the city's historic gains "mean its price boom is likely to slow more abruptly."

NAB is predicting a stronger outcome for Perth in 2025 with gains of +8.3 per cent forecasted for the year ahead. NAB, along with Westpac and ANZ, see the Reserve Bank of Australia cutting the cash rate in May 2025, a move that could serve to reignite buying activity around the country after many months of high interest rates. 

SQM Research's latest Boom and Bust report outlines several possible scenarios for the Perth property market in 2025 depending on factors like interest rate movements and inflation, population growth, and the stability of commodity prices. In all four presented scenarios, Perth home values are predicted to gain a minimum of +7 per cent for the year, with a best-case scenario ramping all the way up to +20 per cent growth. 

Housing Industry Association chief economist, Tim Reardon, told Domain "What we’re likely to see over the next five years is much more of a typical cycle where house prices rise, you get a short period of stabilisation, before they rise again.

"Western Australians are not accustomed to seeing continuous house price growth, and that’s likely to be the scenario for at least the next five to 10 years. Given the levels of migration we’re seeing at the moment that volume of homes that are being delivered aren’t sufficient to meet underlying demand – that will see established house prices continue to grow."

How are Perth house prices expected to change in 2025?

According to KPMG Economics, Perth house prices are expected to perform more in line with the rest of Australia's capital cities in 2025 when compared to the outstanding gains seen in 2024. KPMG sees Perth house values rising by +5.2 per cent across the year. 

In December 2023, the median house price in Perth was only the sixth highest of Australia's capital cities at $708,335. By December 2024, that figure had risen to $847,518, having a significant impact on the city's affordability and putting some downward pressure on the exceptional growth seen throughout 2024. As a result, it's expected that house values will not continue to rise at such a rapid rate in 2025.

What's the Perth apartment market like?

Units outperformed houses in Perth over 2024, with values rising by +22.7 per cent for units compared to +18.7 per cent for houses. That trend has been driven by a hunt for affordability as high interest rates and record-high property values push buyers towards more accessible property types. 

As far as rentals go, rent.com.au data shows units in Perth have a median weekly rent of $610 compared to $660 for houses as of December 2024, suggesting that apartments are delivering comparatively strong returns for investors.

Best suburbs in Perth for investment in 2025

Smart Property Investment’s Fast 50 2025 report likes the following locations in or near Perth:

• Armadale, with a median property price of $350,000 - for a self-contained suburb that is in one of the country’s fastest-growing Local Government Areas (LGAs). It has grown +16.7 per cent over the past year.
• Baldivis, with a median property price of $514,000, is an affordable, family-friendly suburb in a rising area 46 kilometres south of Perth. It has grown +14.0 per cent over the past year. 
• Huntingdale, with a median property price of $495,000, sits in southeastern Perth and is another accessible, family-friendly spot that appeals to investors and first home buyers alike. 
• Lockridge, with a median property price of $400,000, is nearer to Perth's CBD in the city's northeast and offers a balance of affordability and connectivity to the city. It's also a short drive to the Swan Valley vineyards. 

Remember, before investing do all your due diligence - including research down to the suburb level, as well as data like rental yields, auction clearance rates, and vacancy rates.
If you are thinking of selling your Perth property, current market conditions - specifically the low amount of stock and strong demand, should keep prices robust for the near-term and possibly longer.