Why invest in Perth

While 0.7% is a historically tight vacancy rate, it is sustainable.

METRONET infrastructure planning limits high-density housing supply along its corridors. Broader supply constraints – including land scarcity and high construction costs – make a sudden spike to 3%+ vacancy (as seen in other capitals) highly unlikely.

If anything, the rate may tighten further.
This low vacancy firmly places market power with landlords, supporting strong rent-setting ability.

Units are currently benefiting from three key factors: 

1. A significant affordability advantage (median price of $639k vs. $895k for houses), 
2. Strong demand from first-time buyers, and 
3. Higher rental yields (5.8–6.1% vs. 4.2–4.5% for houses). 

While unit growth may moderate after these rapid gains, the current strategy is to buy units for immediate yield and cash flow, while holding houses for long-term capital appreciation.

Your choice should align with your investment goal:
Houses: Typically offer better capital growth (7–12% p.a.), especially in established suburbs near Metronet corridors.
Units: Provide stronger rental yields (5.4–5.7%) and a lower entry point ($615k–$638k median).
If you are focused on capital growth, consider houses.
If your priority is immediate cash flow, units in areas like Scarborough or East Perth are a strong option.

Commodities still drive over 40% of WA’s economy. However, diversification is underway, with sectors like healthcare, construction, and technology now growing faster.

Mining employment remains solid, and construction jobs are projected to peak around 2027–2028.

This improved diversification means lower economic volatility overall.

While a commodity-price downturn remains a risk, it is significantly reduced compared to the 2015–2020 cycle.

They represent different investment strategies.

Spearwood is a growth-focused suburb with a lower entry point ($600k–$750k), recent growth of 22.3%, yields around 4.4%, and long-term potential from airport expansion.

Scarborough is an established, higher-entry ($850k–$950k) suburb offering consistent 4.8–5.2% yields and stable rental demand driven by its lifestyle appeal.

An ideal portfolio might include both: allocating 60% to Spearwood for growth and 40% to Scarborough for yield and stability.

It is highly likely.

With annual growth forecasts between 7.1% and 10.2%, a midpoint of 9% would bring the median to approximately $975k by the end of 2026.

Entering the market before the $1 million psychological barrier is breached offers better value positioning.

Once surpassed, investor perception often shifts, viewing the market as “more expensive.”

Armadale sits at a unique intersection of new infrastructure and value.

The reopened Armadale Line Inner Section (June 2025) with five new elevated stations provides the catalyst.

With an entry point of $450k–$550k, the gentrification trajectory is clear: 2025 sees improved access, 2026–2027 will attract a demographic shift (young professionals), leading to sustained price appreciation (7–10% p.a.) from 2028 onward.

Early entry captures this full cycle.

It offers both.

Fly-In-Fly-Out (FIFO) workers provide a stable rental floor with strong weekly rents ($600–$750). However, the greater upside comes from East Perth’s ongoing urban renewal—its riverfront appeal, CBD proximity, and planned developments position it as a strong gentrification candidate.

Think of it as FIFO demand providing reliable income, while gentrification drives long-term capital growth.

Buy now. By the time a major infrastructure project is completed, the price adjustments in nearby suburbs have typically already occurred.

Waiting until mid-2026 would mean buying into already repriced markets.
A better strategy is to target purchases in late 2025 or early 2026 to capture the repricing that happens as completion becomes certain.

These infrastructure investment windows are time-limited.

The primary risk is a global recession that sharply reduces commodity demand, leading to mining job losses, slowed migration, and rental market pressure. However, this is considered a low-probability “tail risk.”

The base case is far stronger: sustained high migration (3.1% p.a.), operational infrastructure de-risking locations, and persistently strong rental demand (0.7% vacancy).

A recession is unlikely to derail 2026 but could impact the outlook for 2027 and beyond.

No—yields naturally compress (decrease) as property prices rise.

Current attractive yields reflect a market that is still repricing to account for new infrastructure value.

Over the next 5 years, expect house yields to settle around 3.5–4.0% and unit yields around 4.5–5.0% as prices catch up.
Importantly, absolute rental income will continue to grow (4–5% p.a.), preserving cash flow.

Yield compression is a sign of a normalising, healthy market.