Western Australia’s housing crisis has intensified sharply, with a new report from the Bankwest Curtin Economics Centre (BCEC) revealing more than 210,000 households now view their housing as unaffordable – a 91% increase in just two years.
The report comes as the Real Estate Institute of Australia recorded the country’s largest quarterly improvement in housing affordability since 2016. Nationally, the proportion of income required to meet average loan repayments fell two percentage points to 48% in the March quarter. However, affordability in WA remains a major concern, with just 39% of renters and 48% of mortgage holders in the state considering their housing affordable.
The BCEC Housing Affordability in Western Australia 2025 Report draws on national housing data from the 2024 Australian Housing Conditions Data Infrastructure Survey (AHCDIS), combined with new suburb-level rental insights, offering the most detailed picture yet of WA’s affordability pressures.
The report finds just 39% of renters and 48% of mortgage holders in WA consider their housing affordable. This affordability gap has widened due to rapid population growth, record-low rental vacancies, construction delays and insufficient housing supply.
“We are witnessing a breakdown in the ability of WA’s housing system to meet the needs of ordinary West Australians,” said Alan Duncan (pictured left), BCEC director and John Curtin distinguished professor.
“We’re building more homes, but it’s not enough to meet demand. Housing costs continue to rise faster than incomes and what’s being built often isn’t where people want or need to live.”
The affordability divide is particularly stark for essential workers.
The report showed that most single-income key workers – including nurses, police officers and firefighters – are effectively priced out of homeownership across much of Perth, which has seen double-digit annual price growth since 2022, outperforming all other capital cities.
Despite WA completing more than 20,000 homes in 2024 – the highest level since 2017 – the state still fell short of its National Housing Accord target by 4,000 homes.
Perth’s rental market is under extreme pressure. The report found the city fell short by 7,700 rental homes between March 2023 and the end of 2024 – just to keep pace with population growth. WA’s population has grown 4.2% since March 2023, with 85% of new arrivals settling in Perth.
The result: Perth’s median weekly rent has skyrocketed to $740, up 76% since 2020.
“Despite some signs of a softening housing market, there has been an accumulation of pressure on households from years of high housing costs, low rental vacancies and an inadequate supply of new stock,” Duncan said.
“These challenges risk slowing the state’s economic development and continue to affect the most financially vulnerable people in our community.”
While Perth’s rental vacancy rate has finally risen above 2% for the first time in over two years, Duncan warned this improvement won’t bring immediate relief.
“Even with urgent action, relief is at least 12 to 18 months away, with rental costs unlikely to stabilise until 2026.”
He said new suburb-level rental bond data revealed an 82% drop in available rentals under $350 per week, exposing a rapid loss of low-cost housing.
“As affordable homes vanish from inner and middle suburbs, low and moderate-income renters are being pushed to the outer edges of the city where jobs and services are scarcer,” Duncan said.
“This is reshaping the social map of our State and deepening inequality.”
For would-be homeowners, rising construction delays are pushing build times past 15 months – adding up to $100,000 to the cost of a new home.
Report co-author Professor Steven Rowley (pictured right), director of the Australian Housing and Urban Research Institute – Curtin Research Centre, highlighted the link between housing and health.
“Our report also highlights the relationship between poor housing and poor health, with 43% of those in unaffordable housing reporting physical health issues and more than 40% report mental health concerns,” Rowley said.
WA’s homelessness rate has increased by 8% since 2016, with women now making up two-thirds of those accessing homelessness support.
“Cost pressures have pushed more and more families into housing crisis and WA’s social housing waitlist has grown to 20,700, an increase of more than a third in five years,” he said.
Priority social housing cases have surged 330% since 2018, with 6,300 people in greatest need currently waiting to be housed.
“The ongoing commitment from the WA government to increase the state’s social housing stock is to be welcomed and 1,700 units added to the social housing stock in the space of two years is good to see,” Rowley said.
“But the need is great and growing, and much more needs to be done.”
He estimates WA needs 16,000 additional social housing units to lift the state’s social housing share to around 5% – similar to levels in New South Wales and South Australia.
The BCEC report outlines more than 30 recommendations, including permanent rent relief programs, expanded rental assistance, and stronger early intervention measures for households at risk of stress or family breakdown.
“Without bold, coordinated action, we risk locking an entire generation out of secure, affordable housing – which will have many negative flow-on effects,” Duncan said.
“We are at a critical juncture: many people working full-time can’t afford a place to live and those who can are being pushed to areas that add cost, stress and complexity to their lives.
“We can get housing right with integrated policy solutions, long-term planning and genuine collaboration – but the time to act is now.”
