Why Perth apartments are having their moment

Perth’s apartment market is experiencing a remarkable resurgence, with compelling evidence suggesting the sector has turned a decisive corner after years of subdued performance.

Digging into the data reveals a compelling proposition for property investors, as well as owner-occupiers who may have been reluctant to take the plunge into apartment living.

Investment forecaster Hotspotting recently identified inner-city apartments as one of Western Australia’s five hottest markets, noting many apartments were trading below replacement value.

With inner-city options starting in the $200,000s and quality apartments available in the $300,000-400,000 range, Hotspotting General Manager Tim Graham asserts Perth offers greater affordability than most other capital cities.

And according to Cygnet West, established apartments recorded a 2.6 per cent increase in average price per square metre during the December 2024 quarter, reaching $7670 per square metre.

More significantly, total apartment sales volumes surged to 1738 transactions, with established apartments comprising 1679 of these sales – a clear signal of renewed market confidence.

The value proposition extends beyond purchase prices. Cygnet West reports rental prices are approaching mortgage repayments in many suburbs, creating compelling pathways into ownership for Perth residents previously locked out of the market.

Infrastructure investment is providing additional momentum. The $1.75 billion Perth City Deal is transforming Perth’s urban core through major projects, including the ECU City campus, WA Cricket Association ground upgrades and the Perth Concert Hall redevelopment.

Supply constraints are equally significant. CBRE research indicates elevated construction costs mean only apartment projects in prestigious western suburbs, riverside areas and coastal locations remain feasible. This dynamic effectively limits new supply while demand continues growing.

The scarcity of new apartment projects enhances the value proposition for those developments which do proceed.

With construction costs now properly factored into pricing, new apartments represent increasingly rare opportunities to secure premium finishes, warranties and modern living standards in a supply-constrained market.

While off-the-plan sales faced headwinds throughout 2024 due to heightened buyer caution, this has created opportunities for astute purchasers to secure new apartments at competitive pricing.

Quality new developments offer modern design standards, energy efficiency and contemporary amenities older stock cannot match.

The apartment market is also benefiting from changing buyer preferences, with downsizers and upgraders increasingly driving activity in western suburbs and riverside precincts.

Perth’s apartment sector appears positioned for sustained growth across both established and new stock.

Established apartments offer immediate value and proven performance, while new developments provide modern amenities and long-term quality which commands premium positioning.

For investors and owner-occupiers seeking accessible entry points into quality urban living, Perth’s apartment market – whether established or newly constructed – offers opportunities which have largely disappeared elsewhere across Australia’s capital cities.