East coast investors with no plans to relocate to Western Australia are fueling Perth's property boom, according to local real estate professionals. Settlement agent Anne Meiklejohn of BAFC Settlements reported unprecedented demand from interstate buyers, a trend that emerged only in the past 12 months. Data released this week shows home values in Perth's southeastern suburb of Armadale surged 25% in 2023, the largest annual increase in Australia.
Local real estate agent Grant Wilson estimated that about 70% of prospective buyers in Armadale are based on Australia's east coast. Meiklejohn noted that historically, few investors sought opportunities in Western Australia, but the new buyer market is now directly impacting prices. One Armadale home recently sold for more than double its 2018 listing price, with offers coming in up to $80,000 above market value.
The median Sydney property price reached $1,128,322 in 2023, an 11.1% rise, while Perth's median house price was $660,754, a 15.5% increase. Meiklejohn attributed the investor interest to high rental returns. The Real Estate Institute of WA (REIWA) reports average weekly rent in Perth at $600, 15% higher than in 2022, with some suburbs like Kewdale seeing 20% month-on-month increases in December.
REIWA president Joe White said costs are unlikely to change soon, despite a slight increase in stock. 'We still have a pretty critical shortage of supply,' he stated. White noted that while hard data on east coast investment levels is lacking, the interstate interest could benefit renters by adding properties to the rental pool, which lost 18,000-20,000 homes post-COVID, driving vacancy rates to 0.7%.
