WA Loses Crown as Australia's Most Affordable State

Western Australia has lost its long-held reputation as Australia's most affordable state, with runaway property price growth eroding the advantage that once made Perth and regional WA a drawcard for first-home buyers and interstate migrants.

Once considered a haven for those priced out of Sydney and Melbourne, WA has seen median home values climb sharply over the past two years, driven by strong population inflows, a tight rental market, and sustained demand from both local buyers and eastern-state investors seeking relative value.

The shift marks a significant turning point for a state that had spent much of the post-pandemic period benefiting from its affordability edge. Perth, in particular, recorded some of the strongest price growth of any capital city in the country, with annual gains outpacing every other major market at the peak of the cycle.

Housing economists point to a combination of factors behind the reversal. A surge in interstate migration — partly fuelled by WA's strong mining-sector employment and relatively lower cost of living — added sustained pressure to a housing supply that struggled to keep pace. Building approvals lagged well behind population growth, and new construction timelines stretched out amid labour shortages and materials cost blowouts.

For many West Australians, the practical consequences are stark. First-home buyers who might have entered the market two or three years ago now face deposit gaps that take years longer to close, while renters continue to contend with vacancy rates that have sat near record lows.

The state government has pointed to a pipeline of new housing developments and planning reforms aimed at unlocking more land supply, but industry groups warn the impact of those measures will take time to flow through to prices on the ground.

Meanwhile, analysts note that affordability is now a national crisis rather than a problem confined to the south-east corner. With WA no longer offering the relief valve it once did, prospective buyers across the country face an increasingly uniform challenge: a housing market that has structurally shifted beyond the reach of average incomes in almost every state and territory.

Whether WA can reclaim its affordability status — or whether the state has permanently recalibrated to a higher price floor — will depend largely on how quickly new supply can meet demand in the years ahead.