After several years of strong growth, Perth’s property market is showing signs of cooling. However, a slower market does not necessarily mean a property crash is on the horizon.
According to an article published by Your Investment Property on 2 October 2026, Perth’s housing market continues to benefit from several underlying economic and supply factors, including high construction costs, limited housing availability, population growth and the strength of Western Australia’s resources sector. For homeowners, property investors and prospective buyers, understanding these factors can help put changing market conditions into perspective.
1. High Construction Costs Are Supporting Property Values
Building a new home in Perth has become significantly more expensive since 2020, according to the source article. Rising material costs, labour shortages and competition for skilled tradespeople have contributed to higher construction expenses.
Western Australia’s resources sector also competes with residential construction for skilled workers, potentially adding to labour constraints. Higher building costs can support the value of existing homes by making new housing more expensive to deliver. However, affordability pressures may also limit what buyers can pay.
2. Perth’s Housing Supply Remains Constrained
The number of Perth properties listed for sale reportedly increased from just over 3,000 to around 7,500 in the year to September 2026.
Despite this increase, listings remained below the historical pre-pandemic levels. Limited housing availability can support prices when buyer demand remains strong. However, conditions vary between suburbs, property types and price brackets, so buyers and sellers should assess their local market rather than rely solely on Perth-wide trends.
3. New Housing Construction Is Taking Time
Increasing the housing supply takes time, even when demand for new homes is strong. When new homes take longer to complete, the existing housing market may continue to absorb demand from buyers who cannot find suitable new properties. For buyers, this reinforces the importance of comparing established homes with the costs, timeframes and risks associated with building.
4. WA’s Resources Sector Supports Jobs and Economic Activity
Western Australia’s mining and energy industries play a significant role in the state’s economy, supporting employment, investment and government revenue.
The WA Government reported that the resources sector generated $226 billion in mineral and petroleum sales in 2025, with iron ore contributing $126 billion and gold reaching a record $36 billion in sales. A strong resources sector can support housing demand by creating jobs and attracting workers to Perth and regional WA. However, commodity prices and global economic conditions can change, so investors should not assume current conditions will continue indefinitely.
5. Population Growth Continues to Support Housing Demand
Population growth is another important factor influencing Perth’s property market.
New residents need somewhere to live, creating demand for rental properties and homes for purchase. The WA Government’s housing market data provides a useful snapshot of property prices, rental availability and building approvals. Its July 2026 figures reported a Perth median house price of $950,000 over the preceding 12 months.
Although population growth can support housing demand, affordability, interest rates and the supply of new dwellings will influence how much buyers can pay.
6. More Housing Is Coming, but Supply Takes Time
There are signs that housing construction is increasing. The WA Government reported that annual building approvals reached 25,050 homes in the year to February 2026, while housing investment and land development initiatives aim to improve supply.
However, an increase in approvals does not mean completed homes become available immediately. Construction timeframes, infrastructure requirements and labour availability all affect delivery. As additional homes reach the market, supply pressures may ease in some areas. Buyers and investors should monitor these changes rather than assume shortages will persist everywhere.
Is Perth Property Still a Good Investment?
Perth’s cooling market does not automatically signal a crash, but neither do strong economic fundamentals guarantee continued price growth. Investors should assess individual properties, local supply and demand, rental yields, borrowing costs and their ability to manage vacancies or higher repayments.
The WA Government’s Housing Market data and economic indicators are useful starting points for tracking conditions.
The key takeaway: Perth’s property market has several supporting factors, but outcomes will vary by location and property type. Research, realistic budgeting and a long-term investment strategy remain essential.
Frequently Asked Questions
1. Is the Perth property market about to crash?
A cooling market does not necessarily mean a crash. Construction costs, housing supply, employment and population growth may support prices, but future movements are uncertain.
2. Why are Perth property prices supported by high construction costs?
Expensive materials and labour can make new homes costlier to build, supporting demand for established properties. However, high costs can also constrain buyer affordability.
3. Will population growth increase Perth property prices?
Population growth can increase demand for housing, but the impact depends on supply, interest rates, affordability and local market conditions.
4. Should I buy an investment property in Perth now?
Assess the property’s price, rental income, ongoing costs, location and your borrowing capacity. Avoid relying on predictions of continued capital growth.
5. Where can I find reliable WA property market data?
The WA Government Housing Market page publishes regular information on property prices, rental availability and building approvals.
Contact Camden Professionals
Contact Camden Professionals to discuss your property investment strategy and advice on how to structure your property purchases. Reach us at 08 9221 5522 or email info@camdenprofessionals.com.au to discuss your circumstances
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