Prospective first-home buyers in Western Australia are facing their most daunting challenge in years, with new forecasts predicting Perth's median house price will smash through the $1 million barrier for the first time in 2026.
A Market Pushed to Breaking Point
The relentless climb in property values is being driven by a critical shortage of supply, which has intensified competition for the most affordable homes. This has created a nightmare scenario where suburbs once considered within reach for new buyers are rapidly joining the 'million-dollar club'.
Sally Tindall, data insights director at comparison website Canstar, states the situation has become unmanageable. "Property prices in Australia, particularly in red-hot markets such as Perth, have become unmanageable for the everyday Australian," she said. "This will remain the case while the balance between supply and demand remains so far out of kilter."
Government Measures Falling Short
Ironically, initiatives designed to help first-home buyers are now exacerbating the problem. The Federal Government's 5 per cent deposit scheme, launched in October 2025, has increased the number of active buyers, further heating demand without addressing the core supply issue.
Similarly, State Government incentives like stamp duty concessions are failing to keep pace with runaway price growth. The Real Estate Institute of WA (REIWA) is calling for increased thresholds, with president Suzanne Brown noting that strong growth has eroded the relevance of adjustments made as recently as March 2025.
Stamp duty itself is identified as a major handbrake on the market, discouraging existing homeowners from moving and thus limiting the turnover of established stock. This comes as the WA State Government recorded a landmark $1 billion in stamp duty receipts in a single financial quarter, making significant tax reform a politically difficult prospect.
The Race to Boost Supply
In a bid to fast-track construction, the State Government has a plan for the WA Planning Commission to take control of developments within 800 metres of ten designated train stations by mid-2026. While this is a lever being pulled, analysts warn that new developments cannot materialise fast enough to meet the current wave of demand from active buyers.
If major bank forecasts prove accurate, the situation will worsen. Perth's median house price could approach $1.1 million by the end of 2027, representing an increase of nearly $6,000 per month. For many aspiring homeowners, this trajectory means remaining trapped in the rental cycle, unable to secure a foothold on the property ladder despite their best efforts.
The consensus among experts is clear: without serious and coordinated reform focused on increasing housing supply and reviewing punitive taxes like stamp duty, the dream of home ownership will continue to slip away for a generation of Australians in Perth.
