Blue-chip real estate boom continues in wealthy WA

Buyer confidence in this capital city’s future, combined with strong economic fundamentals and limited supply helps drive 24.7 per cent increase in home values over the past year.

The luxury five-bedroom property at 28 Challenger Parade, City Beach, recently sold for $11.2m.

Perth’s unique combination of strong economic fundamentals, high demand and limited supply of quality homes has created a period of continued growth and opportunity in the luxury property sector.

The Real Estate Institute of Western Australia reports a sharp drop in available listings, with only 3266 properties for sale in August 2024, down from 5178 the previous year.

This undersupply has helped drive a 24.7 per cent increase in home values over the past year, according to CoreLogic, with monthly gains continuing at 1.8-2 per cent.

As a result, 32 per cent of Perth’s suburbs now have median house prices exceeding $1m, up from 20 per cent a year ago.

Shore Property principal Scott Swingler recently managed one of the state’s highest sales for August, a five-bedroom luxury home at 28 Challenger Parade, City Beach, which sold for $11.12m.

Unusually for a top property, public open inspections were held, attracting 30 groups of qualified buyers per viewing.

Held over three weekends, the home attracted 100 groups and multiple offers.

“Buyers can see a sunny upside to Perth’s future, which helps fuel confidence,” Swingler says.

He adds that strength in the top end of Perth’s market isn’t a new phenomenon, with plenty of people quietly spending on quality property over the past decade.

“If you have the product, there’s plenty of buyers out there with the money. It’s just a matter of finding available product. Every time we bring something at the top end, we’re astounded by how many people are looking that you don’t see day to day,” he says.

“What’s happening now is that the middle of the market is so strong it’s making the prestige end look relatively cheap. This is giving astute buyers the confidence to buy at the top end, seeing good value and potential for long-term growth.”

Western Australia’s strong economic fundamentals, including some of the highest incomes in the country and a robust resources sector, are key drivers of property market growth, with the state consistently ranking highly in CommSec’s State of the States report for population growth and housing ­finance.

Ray White Dalkeith Claremont agent Thomas Jefferson Wedge is marketing Duncraig House, Perth’s most expensive listing, with a guide price of $32–$36m, and notes a consistent level of interest.

“That price point isn’t a stretch for high-net-worth clientele, but they ask why they should move to Perth. This is the best-kept secret in the world. I’ve lived all over the world, and I think we’ve won the location lottery here in WA. People don’t realise how good they’ve got it here,” Wedge says.

The Agency’s Marcus Sproule, specialising in Perth’s prestigious western suburbs, is seeing strong local buyer interest, as evidenced by the recent sale of 53 Watkins Road, Dalkeith.

The property at 53 Watkins Road, Dalkeith, Western Australia.

Listed with a guide of $4.5m–$5m, the property attracted 89 inquiries and 76 inspections during its four-week campaign, selling within the expected range.

“It is a busy market, primarily driven by the locals – doctors, lawyers, and business owners – in the $3m–$5m range. Then in the $10m-plus market, there’s a lot of wealthy families and people in the mining industry,” he says.

Sproule estimates about 30 per cent of transactions at the higher end are closed off-market, with large family homes in Cottesloe, Peppermint Grove, and Mosman Park the most sought-after.

“There’s no desperation out there. Most people know where they want to be and are ready to jump when the right one comes up,” he says.

However, the tight market conditions have created a paradox for some vendors.

Many homeowners in Perth’s blue-chip suburbs are hesitant to list their properties, fearing they won’t find a suitable downsizer in time.

“Sellers might be ready to move, but they need to find something to buy,” Wedge says.