Perth residential property market insights – February 2022


As Perth continues to demonstrate strong growth conditions, our team analyse the biggest trends impacting the western capital in February 2022.

Trend 1 – Perth affordability supporting strong rental yields

Despite a further 0.3% rise in CoreLogic’s Home Value Index in February, Perth remains one of the most affordable capital city markets across Australia. The research firm showed Perth had a median value of $535,335 in February 2022 – over two times more affordable than Sydney, where the median value was over $1.1 million. Combined with significant rental growth over the past 12 months, Perth’s comparative affordability has supported strong gross rental yields for the western capital, currently sitting at 4.2% for houses and 5.4% for units.

Trend 2 – Houses outperforming units for long-term growth

Data from CoreLogic has shown that houses continue to outperform units for long-term capital gains. According to their Hedonic Home Value Index, the ten-year annualised growth rate in Australian house values was 6.2% per annum as of January 2022, compared to 4.1% per annum for units. Houses typically offer a higher land value component than units due to the latter’s shared ownership structure and less implied land value. This was noted in a recent press release by CoreLogic Australia’s Head of Research, Eliza Owen: “What this means is that house owners accrue a lot more value over time compared to unit owners. The nominal gains in the median Australian house value over the past decade totalled around $340,000, compared with $197,000 for the median unit gain.”

Trend 3 – Purchase activity on the rise

February figures from the Real Estate Institute of Western Australia have revealed a rise in purchase activity across Perth. According to the Institute, an average of 1,114 properties were sold per week in February, an increase of 29.71% from January’s averages and up 23.94% from the same period in 2021. At 7,943 listings, the total number of properties for sale remains well below what is considered a balanced market (typically 12,000-13,000 listings), with this combination of buyer demand and limited supply continuing to support growth in property prices.

Trend 4 – Dwelling approvals fall in first month of 2022

The total number of dwellings approved in Western Australia dropped by 19.9% in January 2022 compared to the month prior, with approvals for private sector houses falling 16.5% across this period (Australian Bureau of Statistics, seasonally adjusted terms). The supply of new homes continues to be constrained by labour shortages and supply chain issues across the construction industry. This is set to put further upwards pressure on prices for the foreseeable future as demand continues to outweigh supply in already-tight market conditions.


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