KPMG’s latest forecasts highlight Perth as the standout housing market in Australia heading into 2026, driven by a severe structural supply shortage and a late-2025 surge in demand. According to KPMG, Perth house prices are expected to rise 12.8% in 2026, the strongest growth of any capital city, with unit prices also forecast to climb sharply (11.6%).
The report notes that around two-thirds of Perth’s annual price growth occurred in the second half of 2025, catching forecasters off guard. This acceleration was fuelled by government policy, particularly the expansion of the 5% deposit scheme, which intensified competition at the affordable end of the market, where Perth already faces tight supply.
KPMG characterises the housing issue as structural rather than cyclical, stemming from decades of underbuilding, especially apartments. In Perth, this imbalance is exacerbated by elevated construction costs, ongoing labour shortages, and high taxes and infrastructure charges on new housing, which have made many projects marginal or unviable.
Investor demand remains resilient, supported by lifestyle appeal and remote-work trends, while rental conditions are expected to stay tight. Rents are forecast to rise by about 3.5% per year through 2026–27, as dwelling construction continues to lag population growth.
Overall, the outlook suggests continued upward pressure on Perth prices and rents, with affordability challenges persisting unless there is a material and sustained lift in new housing supply.
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