Warnbro Earns a Spot Among WA's Top 20 Affordable Suburbs - The West Australian

Government policies designed to give first-homebuyers a much-needed upper hand appear to have fallen flat, with new data indicating a bigger drop in entry level buyers than investors.

New data from Loan Market, one of Australia’s biggest broking groups, show applications to its brokers from first home buyers in WA from February to June this year dropped 35 per cent, while those from investors fell 24.5 per cent in the same period.

Compared to June last year, investor loans with Loan Market were down 13 per cent in WA, and first home buyer loans were down a massive 30.5 per cent.

It follows the Federal Government’s tax changes to deter investors from the market, and an expansion of the 5 per cent Home Guarantee designed to help first home buyers get into the market.

Loan Market said there was a bigger drop in investors nationally over the same periods, with WA the only State where there was a heftier fall in first home buyers than investors.

Loan Market’s Balpreet Bal confirmed there were more investors coming to him for loans than first home buyers.

“The rental yield in Perth is still good so that’s contributing to a stronger investment market in WA,” he said.

“But first home buyers are really confused about which way the market will go and they are holding back.”

Mr Bal said suburbs with over-inflated prices were now seeing price drops, but most suburbs appeared to be holding their value.

“In some areas prices are holding,” he said. “Vic Park is holding better than Armadale, for example.”

Property analyst Gavin Hegney said both investors and first home buyers were concerned about affordability, and were in “wait and see mode.”

“It’s classic stagflation,” he said.

Mr Hegney said a significant portion of would-be investors had decided against investment because they could not afford to sustain an investment property without negative gearing benefits.

But he believes the anticipated increase in rents — set to eventuate amid the shrinking pool of rental properties — will eventually lure some back in.

Meanwhile, a big portion of first home buyers were unable — or unwilling — to buy in a market which had seen prices practically double since the pandemic. Rising rents will make it harder for them to beat the rent trap.

Mr Hegney said many entry-level buyers were waiting to see if homes dropped in value over the next few months as investment competition weakened.

The three rate hikes had reduced borrowing power at a time when the expanded Home Guarantee fuelled the price of entry-level homes, pushing $750,000 homes to the $850,000 scheme price-threshold within months of the announcement.

Research by the Real Estate Institute of WA, exclusively for the The West Australian, shows that while affordability is critically low across WA, there are 37 suburbs in Perth with a house median price below $800,000.

The cheapest is Mandurah, in Peel, which has a median sale price of $675,000. In Greater Perth, Medina takes the mantle for the cheapest house median, at $680,000 and Warnbro, in the Rockingham region with a house median of $790,000.

REIWA included only suburbs with 28 or more sales in the year to June 2026.

Original article written by The West Australian and posted on Perth Now.

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