First-homebuyers’ $1m nightmare as industry leaders make grim prediction about Perth property in 2026

First-homebuyers’ hopes of achieving the Great Australian Dream of property ownership are slipping further into the quagmire, with industry leaders predicting Perth’s median house price could hit the $1 million mark by the end of this year. The $1m 2026 prediction has promoted calls for the Cook Government to do more to help first-homebuyers get into the Perth and WA property market, including more stamp-duty relief in the upcoming May State Budget. Just seven years ago, the median house price in Perth was just under $500,000. Now, according to Cotality’s latest figures, Perth’s median property value sits at $940,635 — the third highest in the country behind Sydney ($1.28m) and Brisbane ($1.036m). Perth’s annual growth rate was 15.9 per cent in 2025, bumping up the median price of Perth housing by more than $100,000. And although the rate of growth is expected to slow in 2026, it is conceivable that by this time next year, Perth’s median house price will top $1m, with predictions house values could increase by about 10 per cent or more. Cotality research director Tim Lawless and REIWA president Suzanne Brown as well as leading financial and political commentator Sally Tindall all predicted a tough 2026 for Perth first-time homebuyers. “We’re definitely seeing the strongest upwards pressure on prices at the lower quartile of the market,” Mr Lawless said. “That simply means that prices are rising the most rapidly for properties that are around entry-level pricing. “So that’s going to be all the more frustrating for first-homebuyers.” Canstar’s Sally Tindall said it was possible that by the end of next year, the Perth median price could be around $1.1m — a rise of $142,000 in the space of 24 months. “Would-be first-homebuyers in Perth are now staring down the likelihood of seven-figure house prices in 2026, with the potential for even further rises in 2027, despite predictions of one, if not two, cash-rate hikes in this time,” Ms Tindall said. “In fact, if Westpac’s forecasts play out across house prices (8 per cent in 2026 and 6 per cent in 2027), a median-priced house in Perth could rise by an estimated $142,348 by the end of 2027 — that’s almost $6000 a month. “While there’s no guarantee these forecasts will materialise, it’s a pretty attractive equation for anyone with skin already in the game. “Yet for anyone struggling to get into the market, it’s yet another reminder of how far the goalposts can move.” First-homebuyers got a Federal Government boost in 2005, with a national 5 per cent deposit scheme. But experts say this has merely driven up the price of housing. Interest-rate hikes are also predicted for 2026, because of still high inflation rates. “With the RBA potentially hiking rates this year, staying within your financial means is far safer than drowning in unmanageable debt just to secure a dream home, which could easily then turn into a financial nightmare,” Ms Tindall said. “While the Home Guarantee Scheme has given thousands of borrowers the leg up on to the property ladder, property prices have risen with them, making it harder for the next wave of first-homebuyers trying to get in. “Property prices in Australia, particularly in red-hot markets such as Perth, have become unmanageable for the everyday Australian and will remain that way while the balance between supply and demand remains so far out of kilter.” On top of large deposits needed by first-homebuyers to get a housing loan, they also face huge stamp-duty costs. REIWA boss Suzanne Brown said WA first-homebuyers faced a tough 2026. “The greatest challenges for first-homebuyers in 2026 will be affordability and supply,” she said. “WA property prices have recorded several years of very strong growth. “REIWA is expecting Perth property prices to increase at a similar pace (to 2025) in 2026. “Sustained strong price growth is making first-home ownership more difficult. “Properties are less affordable than in previous years, and first-homebuyers need to save larger deposits and secure larger loans to buy a home.” The Cook Government last year announced that anyone purchasing a property of $700,000 or less would receive stamp-duty exemptions. REIWA believes the $700,000 threshold needs to rise in line with the rising median housing price in Perth. “The State Government offers stamp-duty concessions for first-homebuyers, which reduces some of the costs of buying a home,” Ms Brown said. “In Perth, first-homebuyers pay no stamp duty for homes valued up to $500,000 and a concessional rate for purchases between $500,000 and $700,000. “However, while the thresholds were increased in March 2025, strong price growth has eroded their relevance. “Only 2.2 per cent of dwellings listed for sale in Greater Perth on January 2 were below the lower $500,000 threshold and only 10.3 per cent were below the $700,000 threshold. “This highlights the need for the thresholds to be increased and linked to REIWA’s market data.” WA Opposition Leader Basil Zempilas is also calling for changes to stamp-duty thresholds. “The Government cannot look first-homebuyers in the eye and say they are doing everything possible to help them. They’re just not,” Mr Zempilas said. “While stamp-duty thresholds remain so far behind the median house price, the ‘pulling every lever’ claim is a deceitful myth. “We need to give young first-homebuyers hope. “At current levels it’s hopeless. A lot of them have just given up and in a State like Western Australia that’s not good enough.”