While most of Australia is searching for equilibrium in the face of interest rate hikes, Perth is weathering the changes remarkably. The city and its suburbs have experienced slight fluctuations in home prices, but the overall outlook is optimistic for a solid market to continue.
What Are the Best Perth Suburbs to Invest in for 2023?
While many properties near Perth are performing quite well, these are our picks for the top Perth suburbs to consider for investing in 2023.
Located northeast of Perth, Brabham is situated in the City of Swan. The suburb experienced significant growth, with quarterly sales increasing from 37 to 90. The affordable lifestyle in Brabham adds to the popularity. Residents have access to recreational facilities and green spaces. Median home prices are in the $400,000 range, and vacancies are at 0.5%.
The suburb of Joondalup is highly regarded for the amenities available there. These include a hospital, a university campus, government offices, retail and a major transport interchange. The northern suburb is exceptionally popular with renters, with a vacancy rate of 0.4% and a median rental yield of 4.0%. The median price for a home is $585,000.
An excellent location for those who enjoy an outdoor lifestyle, Waikiki is a vibrant, growing suburb located in the City of Rockingham. Waikiki saw a substantial uptick in sales recently. The sales rate in Waikiki two years ago was 70-80 properties a quarter. The most recent sales records show sales of 130-140 a quarter. The suburb is fairly affordable, with houses ranging in price from the high $300,000 to the lower $400,000. Waikiki offers exceptional homes near the beach as well as near the Rockingham Lakes Regional Park.
Located south of Perth, Armadale is an exceptionally affordable suburb that has doubled sales volume in the past two years. Even with numerous price hikes, the median home price in Armadale is $300,000. The suburb has a direct train line into the city, schools, and significant shopping opportunities.
Although the suburb of Ellenbrook is relatively new, it is extremely popular, and sales have nearly tripled in the past two years. The area has excellent access to highways along with greenspaces, schools, shopping and recreational activities. Ellenbrook’s median price is $400,000. The area also has a vacancy rate of 0.4%.
A southern suburb of Perth, Orelia is popular with younger families. The region has convenient access to transportation, shopping, green spaces, and schools. Additionally, an industrial employment zone is nearby. Affordability is a significant factor making Orelia a sought-after area. The median home price is $305,000. Vacancy rates are 0.3%, and rental yields are 6%.
The well-established suburb of Forrestfield is located 15 kilometres southeast of Perth. Divided by the Roe Highway, Forrestfield has a thriving industrial area to the north and a well-developed residential region to the south. Forrestfield also has an array of educational, retail and recreational amenities and good access to transportation. Sales activity grows consistently, and vacancy rates are at 0.2%. The median price is currently $505,000.
Baldivis recorded substantial growth during the past year of 8.9%. The vacancy rate for the suburb is 0.4%, well below the Perth average of 0.6%. This semi-rural suburb is relatively affordable, with a $435,000 median home price. In addition to schools, shopping and reliable transportation, Baldivis gains popularity due to its seaside location and proximity to Rockingham.
Strong growth can be found in the suburb of Hocking, located in the City of Wanneroo in Perth’s far northern region. The Wanneroo LGA is incredibly fast-growing, the fifth fastest in all of Australia. The population in the area is expected to grow by 71% over the next two decades, making Hocking an investor’s dream. Boasting a vacancy rate of lower than 0.5%, Hocking is a comfortable suburb with schools, parks, retail options and the nearby Yellogonga Regional Park. Currently, the median price sits around $580,000.
Wellard is located in the City of Kwinana, the area’s most expensive suburb. It has a median house price of just above $400,000. The region saw sales activity double compared to two years ago. Part of Wellard’s appeal is the development of a Village Centre built around the Wellard Train Station. The area will feature retail, residential, commercial, and community facilities when complete. There are several quality schools in the area, parks, and other green spaces. Perth CBD is accessible in around 30 minutes and Mandurah in 20 minutes, while an integrated bus service provides access to the major centres of Kwinana and Rockingham.
Is It a Good Time to Invest in Perth?
Looking at the entire country, it is easy to see that Western Australia (particularly Perth and its suburbs) outperforms all other capital cities. Bucking the trend seen in other parts of the country, Perth and its vicinity have the most robust market, with over 100 suburbs listed as rising markets. In contrast, between the years 2015 and 2020, the area listed only 29 suburbs as rising. Some credit goes to the fact that Perth has some of the most reasonably priced properties on the market. Right now, the median cost for Perth property is $585,000. No other capital city comes close to that price.
Forecasts from the National Australia Bank (NAB) show a drop in property prices in Perth and its suburbs. NAB projects a 13.1 per cent decline in prices in 2023 before a rebound of 1.2 per cent in 2024.
The news seems encouraging for those entering the investment property arena, provided they are in it for the long haul. NAB Group chief economist Alan Oster believes that the Western Australian economy will still be strong in five years and profits will be likely.
Looking at other factors, such as the high demand for rental property, investing in the Perth market in 2023 seems likely to net considerable profits shortly.
What Will Happen With the Perth Rental Market in 2023?
Rental property is still a significant commodity in Western Australia. The price for rentals in WA will be above that of other capital cities at 4.1 per cent over the next year. Prices for rental properties will likely climb 4.3 per cent over the next two.
High rental yields coupled with a shortage of available places to rent create a perfect storm for those interested in investing in rental property near Perth. In addition to local investors taking advantage of the current climate, there is a rising interest in acquiring property in Perth and surrounding suburbs from interstate property investors.
In 2023, the rental market will be profitable for those who are investing. The opposite will be true for those looking to rent, as rental units are expected to be in short supply.
Unsure How Much You Can Borrow for Your Home?
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