The big picture
Perth is still running hot, but borrowers are now dealing with a more complicated market: property prices are rising, listings remain tight, borrowing capacity is under pressure, and home loan rate uncertainty is back on the table.
The RBA lifted the cash rate to 4.10% on 17 March 2026, and several economists are now warning that further hikes are possible if inflation pressures persist.
At the same time, Perth property values continue to outperform. Cotality data shows Perth values rose 2.5% in March and 7.3% over the quarter, while Sydney and Melbourne softened.
What’s happening in the market?
1. Perth prices are still being pushed up by low supply
The strongest signal remains supply. REIWA expects Perth’s median house price to rise by more than 10% in 2026, and units by 15–20%, citing a significant imbalance between supply and demand.
This matters because even if some buyers pull back due to higher home loan rates, there still may not be enough quality stock to create meaningful downward pressure.
2. Rate pressure is back (and it’s not just the RBA)
Borrowers are feeling pressure from two directions: official rate hikes and rising living costs. Recent reporting described fuel and cost-of-living increases as a “hidden rate rise” because they reduce household surplus even before a lender changes the mortgage rate.
Westpac has also lifted fixed rates twice recently, with fixed rates starting from around 6.29%, suggesting lenders are already pricing in higher inflation and funding risk.
3. Lending is still active, but banks are watching risk closely
ABS data shows new housing loan commitments rose in the December quarter 2025, with owner-occupier, investor and first-home buyer activity all increasing. First-home buyer loan numbers rose 6.8% for the quarter.
But APRA has also introduced debt-to-income (DTI) guardrails from 1 February 2026, limiting the share of new lending with DTI ratios of six or more. That means highly stretched borrowers may face more scrutiny.
4. Investor demand is still part of the story
Investor lending remains strong. APRA’s December 2025 data shows investment loans increased as a share of ADI housing credit, while Westpac noted investor lending values were up 31.8% year-on-year in 2025.
For Perth, that investor activity is important because it adds competition in the same price brackets first-home buyers often target.
What this means for borrowers
This is not a “panic” market, but it is a market where strategy matters.
For first-home buyers, waiting for a major Perth price fall may be risky. Prices may eventually slow, but the current supply-demand imbalance means a sharp drop still looks unlikely.
For homeowners, now is a good time to review your loan before more rate movement potentially flows through. Even if you do nothing, your borrowing position may be changing because lenders are reassessing living expenses, buffers and debt-to-income exposure.
For investors, Perth still has strong fundamentals, but the easy gains may be harder to find. Suburb selection, rental yield, cash flow and loan structure matter more than simply “buying in WA”.
What smart borrowers are doing now
Smart borrowers are not trying to perfectly time the market. They are getting prepared by:
Reviewing their current rate and structure before more fixed or variable changes flow through.
Checking borrowing capacity early, especially if they are buying in a competitive Perth market.
Building buffers in offset accounts so they are less exposed to rate rises or cost-of-living shocks.
Getting pre-approval before attending home opens, because fast markets reward prepared buyers.
Stress-testing repayments at higher rates, not just today’s rate.
Considering whether fixing part of the loan makes sense, rather than assuming variable is always best.
Using equity strategically, especially if upgrading, investing or consolidating expensive debts.
Avoiding rushed decisions, because a strong market does not mean every property is a good buy.
Ready to Make a Smart Move in This Market?
Perth’s property market isn’t slowing down, but that doesn’t mean you should rush in without a plan.
The borrowers who are winning right now aren’t guessing.
They’re working with a clear strategy, understanding their borrowing capacity, and making confident, well-timed decisions.
If you’re thinking about buying, refinancing or just want to understand your options, we’re here to help.
Book a free strategy session with a Perth mortgage broker today and get a clear plan tailored to your situation.
The smart borrowers we’re working with right now aren’t trying to time the market — they’re getting clarity around their borrowing capacity and working with a mortgage broker in Perth to put a strategy in place.
