As Perth house prices nudge $1 million, what’s your suburb worth?

Perth house prices have hit new highs, surpassing a median of $900,000 for the first time, with a new report predicting it could hit $1 million by the end of 2025.

The latest Domain House Price Report revealed home values lifted 19.5 per cent over the year to reach a median of $913,011, the largest increase in the nation.

Perth house prices have recorded double digit growth this year.Credit: Getty Images

But there are signs the rapid rise is stagnating, with a gain of 1.6 per cent recorded over the December quarter, the weakest outcome for Perth since 2019.

In fact, Perth has experienced the sharpest slowdown in price gains throughout 2024, with a 14.1 per cent increase in the first half of the year, followed by just 4.7 per cent in the second.

Brisbane house prices hit $1 million for the first time, while in Adelaide house prices are on track to eclipse $1 million over the first quarter of 2025, needing just shy of $8000 to achieve the milestone.

Domain chief of economics and research Nicola Powell said even with the slowdown, Perth could also reach the $1 million milestone by the end of 2025, needing an increase in median prices of 9.5 per cent, or around $87,000.

“With a forecast growth of 8-10 per cent, this remains a possibility,” she said.

“Our housing market has shown remarkable adaptability and strength despite relentless cost-of-living pressures and a cash rate that remained higher for longer than many had hoped.

“But the market is finally catching up with the financial strain many buyers are experiencing, reflecting a shift in conditions that can no longer be overlooked.”

Powell said all capital cities are now declining, stable or experiencing a rapid slowdown in growth and all are past their peak quarterly and annual growth rates.

“The slowdown is largely due to affordability pressures, with rising prices making it harder for many buyers to keep up,” she said.

“Wages haven’t kept up with home prices, and the ongoing cost-of-living squeeze is only adding to the challenge.

“Many potential buyers are holding off, hoping for a cash rate cut to boost their borrowing power. As demand wanes, supply has been steadily rising – 2024 ended with the highest number of homes for sale for the month of December across the combined capitals in three years.”

Perth unit prices are at record highs rising 5.4 per cent, or $26,000, over the quarter to a median of $511,000. It’s the first time unit prices have surpassed $500,000.

Strategic Property Group managing director Trent Fleskens said the lack of supply to keep up with the state’s booming population was the most chronic out of the capitals.

“We can’t even get 1000 apartments a year out of the ground,” he said.

“When we finally figure out how to build more than 25,000 homes (our average has been 15,000 since COVID), or our annual population growth falls below 30,000 a year, or our prices become so expensive they rival Sydney’s like in 2008 and the average household can’t carry the required loan to buy an average house like what is happening in Sydney now, then come give me a call.

“Meanwhile, for better or worse, prices only go one way when you can’t solve an issue like this. And we have a long way to go to figuring this one out.”

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