As we approach the new financial year, Perth’s mortgage landscape continues to evolve in response to shifting economic conditions. With a rising cost of living and a dynamic property market, it’s crucial for prospective homeowners and investors to stay informed. Here’s a breakdown of the top mortgage trends shaping Perth’s housing market as of March 2025.

1. Rising Living Costs Impacting Borrowing Power

The Australian Bureau of Statistics (ABS) reported that living costs for all household types increased by 0.6% to 1.6% in the March 2025 quarter, with health, housing, and food being the primary contributors .

Living Cost Indexes (LCIs) measures the price change of goods and services and its effect on living expenses of selected household types Over the past year, these costs have risen between 2.4% and 3.5% . These ongoing increases are affecting household budgets and, consequently, borrowing capacities.

What you can do:

  • Refinance strategically: Lock in competitive rates or consider splitting your loan to manage repayments effectively. This is a no brainer for those who haven’t refinanced their home loan for a few years or potentially much longer. Get in touch if refinancing has been on your “to do” list for a while. We’ll make it easier than you think it’s going to be.
  • Explore offset accounts: These can help reduce interest payments and provide greater financial flexibility.
  • Make use of our RateTraker tool to continually monitor your interest rate.

2.  Perth’s Property Market Continues to Experience Growth 

Despite economic challenges, Perth’s property market remains resilient, driven by steady demand and investor attention. The Real Estate Institute of Western Australia (REIWA) forecasts another whopping 10% growth in property prices for 2025 . In the March quarter, Perth’s median house sale price rose by 2.7% to $770,000, while the median unit price increased by 4% to $520,000.

What you can do:

Click here to learn about the 4 key indicators of a cooling market.

3. Refinancing and Fixed-Rate Loans Gaining Popularity

Given the fluctuating interest rate environment, many homeowners are considering refinancing to secure more favorable terms. Fixed-rate loans are particularly appealing for those seeking stability in their repayments.

What you can do:

  • Assess your current loan: Determine if refinancing could lead to better rates or terms.
  • Consult with experts: A mortgage broker can provide personalised advice based on your financial situation.

4. Increased Interest in Regional and Outer-Perth Properties

As affordability becomes a concern in the Perth metro area, buyers are turning to regional areas and outer suburbs. This shift is driven by lower property prices and improved infrastructure in these regions.

What you can do:

  • Explore alternative locations: Consider properties in emerging suburbs or regional areas that offer better value.
  • Evaluate investment potential: These areas may provide opportunities for capital growth and rental yields.

5. Enhanced Borrowing Capacity with Lender Flexibility

Home loan lenders are increasingly offering flexible borrowing options to accommodate diverse financial situations. This includes considerations for self-employed individuals, freelancers, and those with non-traditional income streams. More and more options are available, especially if you look outside of the traditional lenders and consider specialist alternative lenders.

What you can do:

  • Prepare comprehensive documentation:Ensure you have detailed records of your income and expenses.
  • Seek professional guidance: A mortgage broker can help you understand your borrowing capacity and match you with suitable lenders.

Navigating Perth’s mortgage landscape in the current economic climate requires careful planning and informed decision-making. By staying updated on market trends and seeking expert advice, you can make strategic choices that align with your financial goals.

Need assistance?

Contact a local Perth mortgage broker today to explore your options and secure the best mortgage solutions for your needs.

Disclaimer: The information provided on this blog is for general informational purposes only and does not constitute financial or professional advice. While we strive to provide accurate and up-to-date information, mortgage laws and regulations can change, and individual circumstances may vary. We recommend consulting with a qualified financial advisor or mortgage broker to assess your specific situation and needs. Base Home Loans is not responsible for any actions taken based on the content of this blog. Always conduct your own research and consider seeking professional advice before making financial decisions.

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