Perth Property Market 2026:
What Changed Since the Budget
— and What It Means for Investors
Dwelling values up 24%. Vacancy at 0.5%. But the May 2026 federal budget changed the rules for investors — materially and permanently. Here is the complete picture.
The Perth Market at Mid-Year 2026
While Sydney fell 0.7% and Melbourne fell 0.6% in May 2026, Perth grew another 1.6% in a single month. That is not a coincidence — it is a structural story driven by population growth, a resources economy, and a housing supply shortfall that has been building for years.
| Metric | Figure | Source |
|---|---|---|
| Median house price | $845,000 | REIWA · Apr 2026 |
| Median dwelling value | $1,017,698 | Cotality · Mar 2026 |
| Annual dwelling growth | +24.3% YoY | Cotality |
| Monthly growth (May 2026) | +1.6% | Cotality · 28-day |
| Unit annual growth | +26.1% | Cotality |
| Days on market (houses) | ~14 days | REIWA · Apr 2026 |
| Active listings vs 5-yr avg | 40–45% below | REIWA |
| Vacancy rate | ~0.5% | SQM · Apr 2026 |
| Median weekly rent (houses) | $700 pw | REIWA · Apr 2026 |
| Median weekly rent (units) | $670–$680 pw | REIWA · Apr 2026 |
| Gross rental yield (houses) | ~4.3% | REIWA |
| Gross rental yield (units) | ~5.9% | REIWA |
What the May 2026 Federal Budget Changed
The budget did three things that every investor must understand before their next acquisition decision.
Negative Gearing Removed for Established Homes
New established residential purchases no longer qualify for negative gearing deductions against other income. Pre-budget purchases retain existing rules.
From 1 July 2027CGT Discount Replaced by Indexation
The 50% CGT discount is replaced with cost-based indexation. Investors pay tax only on gains above inflation — changing the after-tax return profile significantly.
From 1 July 2027Trust Tax Rate Increases to 30%
Discretionary trusts used as investor structures face a new 30% tax rate. Investors holding property through family trusts must review their structure now.
From 1 July 2028| Change | Detail | Effective Date | Impact |
|---|---|---|---|
| Negative gearing removed | Established residential purchases post-budget no longer qualify | 1 Jul 2027 | High |
| CGT discount replaced | 50% discount replaced by cost-based indexation | 1 Jul 2027 | High |
| Trust tax rate increase | New 30% rate for discretionary trusts | 1 Jul 2028 | Medium |
| Pre-budget purchases | Existing negative gearing rules fully retained | Ongoing | Retained |
Analysts estimate a 10–20% reduction in borrowing capacity for investors and a ~34% drop in new investor engagement following these budget changes. Auction clearance rates dropped to 43.1% nationally post-budget, with transaction volumes estimated to fall ~20%.
Not sure how these changes affect your specific position? A discovery call covers your cashflow, structure, and sequencing plan.
Book a Discovery Call →Why Perth’s Vacancy Rate Is Still Under 1%
A balanced rental market sits at approximately 3% vacancy. Perth at 0.5% is not a tight market — it is structurally landlord-dominant, and has been for several years. Understanding why matters for every investment decision made in this environment.
Fewer than 1,000 rental properties are available across the entire Perth metro at any given time. This is not a rounding error. It is a structural feature of the market.
— SQM Research / REIWA, April 2026What 0.5% Vacancy Means for Landlords
Record median rents of $700 per week for houses and $670–$680 per week for units. Median days to lease of approximately 14–16 days. Further upward rent pressure expected in inner and middle ring suburbs. For existing landlords with well-located established properties, this environment is as favourable as it has been in living memory.
What This Means for Investors Right Now
The budget changes the calculation. It does not change the structural case for Perth. But it demands that every investor approach decisions with a clearer strategy than was needed in 2023 or 2024, when the market was doing much of the work for them.
| Situation | Recommended Approach | Direction |
|---|---|---|
| Existing established property, pre-budget purchase | Hold — existing negative gearing rules retained; tight market supports rent growth | Hold |
| New established property purchase | Model cashflow without negative gearing offset — prioritise yield and location above all | Review |
| Positively geared or near-neutral asset | Strong fundamentals still support acquisition with clear portfolio blueprint | Buy |
| Deeply negative geared, poor location, low yield | Exiting may be prudent under the new tax regime — review with accountant | Caution |
| Trust structure currently in use | Seek qualified accountant advice on restructuring before 1 July 2028 | Act Now |
| New build or development site | Review tax treatment — may retain advantages not available for established stock | Review |
The Three Strategic Shifts That Matter Most
Cashflow modelling is now non-negotiable. With gross yields averaging 3.6–4.3% on houses and investor mortgage rates in the low-to-mid 6% range, established house investments are already operating at a cashflow deficit for many investors. Remove negative gearing from that equation — as the new rules require — and cashflow becomes the primary lens through which every acquisition must be evaluated.
Yield deserves more weight than it has been given. Units and townhouses in Perth currently generate gross yields of approximately 5.9% — materially higher than the 4.3% available on houses. In an environment where negative gearing is no longer available for new established purchases, assets that generate stronger rental income become structurally more attractive.
Location selection has become a more important differentiator. Inner and middle ring suburbs with strong transport connections — along the Ellenbrook, Yanchep, and Thornlie-Cockburn lines — continue to show tight vacancy and fast leasing times. Greenfield sites on the outer fringe face rising competition from new supply and should be approached with considerably more caution.
The right strategy depends on your income, equity, existing structure, and timeline. That is exactly what a discovery call with Enrich covers.
Book a Discovery Call →The Investor Checklist for Mid-Year 2026
Before making any decision — buy, hold, or sell — work through every item below.
Have you recalculated your investment’s annual cashflow position assuming no negative gearing offset for new established purchases from 1 July 2027?
Have you reviewed your holding structure with a qualified accountant in light of the trust tax changes effective from 1 July 2028?
Is your property located in an area with strong transport access and structural rental demand, or in a greenfield site with rising supply competition?
Are you prioritising yield alongside capital growth in your acquisition criteria — not treating yield as an afterthought?
Are you across Western Australia’s tenancy reforms — rent increase rules, minimum standards, safety compliance — to avoid regulatory risk eroding your returns?
Do you have a sequencing plan for your portfolio — not just a view on the next purchase, but how each acquisition positions you for the next?
Frequently Asked Questions
Yes. Properties purchased before the May 2026 budget announcement retain existing negative gearing rules in full. Only new established residential properties purchased after the budget date are subject to the new regime from 1 July 2027.
Most analysts and valuers expect price growth to moderate — from mid-20s annual growth into high single digits — rather than fall outright. Perth’s structural fundamentals including 0.5% vacancy, population growth of 2.4% per year, and a supply shortfall of approximately 40% below historic averages remain intact.
Units currently offer gross rental yields of approximately 5.9% compared to approximately 4.3% for houses. In an environment where negative gearing is removed for new established purchases, higher-yielding assets provide better cashflow support. However, location, quality, and body corporate structure all matter — well-located middle ring units are very different investments from off-the-plan apartments in oversupplied areas.
The replacement of the 50% CGT discount with cost-based indexation means investors pay tax only on gains above inflation rather than receiving a flat 50% reduction on the total gain. The precise impact depends on individual holding periods, purchase prices, and inflation outcomes. Speak with a qualified accountant to model this for your specific position.
The timing of an acquisition should be driven by your strategy, your financial position, and whether the asset fits your portfolio blueprint — not a tax deadline alone. That said, the pre-July 2027 window does preserve access to existing negative gearing rules for established property purchases made before that date. The right answer is specific to your income, equity, and portfolio sequencing plan.
A Conversation Before a Commitment.
20 minutes. No obligation. No property listings. Just an honest assessment of your position and what a well-structured Perth portfolio looks like for you specifically.
Book a Discovery Call → Limited client spots available at any time
