Regional WA locals struggle to compete with interstate investors

Buyers from the other side of the country continue to play a major role in driving up property prices in regional Western Australia.

Geraldton was the top performing regional centre for the March 2025 quarter, according to the latest REIWA data.

Its median house sale price rose 6.5 per cent to $490,000, up from $460,000 in the December 2024 quarter.

It was the second consecutive quarter that the regional centre recorded the strongest price growth.

REIWA Regional Spokesperson Peta McKenzie said the Geraldton market recorded continued growth over the March quarter, driven by strong investor activity.

“There was significant interest from Eastern States investors, particularly for dwellings in the $400,000 to $600,000 range,” she said.

“They were looking for well-presented homes offering reasonable yields. These properties generally attracted multiple offers and, in some cases, sold well above the asking price.”

Ms McKenzie said investor activity had placed pressure on local buyers.

“In the March quarter REIWA members report investors often secured properties ahead of local owner occupiers by offering slightly more,” she said. 

“While Eastern States investor activity softened slightly in April, creating a more even mix of buyers for a time, it has increased recently, maintaining the challenges for owner occupiers.

Ms McKenzie said Eastern States investors were active also active in Broome and Kalgoorlie-Boulder.

“In Broome, investors were generally looking for properties in the $600,000 to $800,000 price bracket, preferably with a corporate or government lease in place,” she said.

“In Kalgoorlie-Boulder they were seeking properties priced under $450,000, preferably on 500sqm blocks, and offering 10 per cent yield.

“There, like in Geraldton, demand from investors made buying a home challenging for owner-occupiers.”  

Conditions were different in Albany and Bunbury, where investors took a back seat to owner-occupiers.

“Our members tell us investment activity has declined in these regional centres, with owner-occupiers making up more than 80 per cent of purchasers,” Ms McKenzie said.

“Both markets still saw some interest from Eastern States investors,” she said.

“In Bunbury, investors were looking for houses, rather than units, preferring green titled properties over strata.

“In Albany, investors were seeking homes priced under $600,000.”

Throughout Western Australia’s south west region, property price continue to soar.

Regional WA rental market

Port Hedland saw the most price growth in the rental market, with its median weekly rent increasing 11.8 per cent to $950.

Ms McKenzie said the Port Hedland rental market fluctuated in recent quarters.

“The increase this quarter follows a 12.6 per cent decline in the December 2024 quarter and a 2.4 per cent increase in the September 2024 quarter,” she said.

“Over the 12 months to March, the Port Hedland market recorded more moderate growth of 5.6 per cent.”

Ms McKenzie said a contributing factor to the strong March quarter increase in Port Hedland was the type of properties being leased in that period.

“REIWA data shows a higher proportion of leases in the upper end of the market this quarter, which contributed to the rise in the overall median,” she said.

“Our members have reported that enquiries remain strong for properties priced between $800 to $1,000 per week, with approximately 70 per cent of enquiries coming from prospective tenants moving to the area for employment opportunities.”

Despite the growth in the March quarter, Ms McKenzie said underlying trends suggest Port Hedland’s rental market was easing.

“Our members reported a slower start to the year, with fewer applications per property and some landlords needing to adjust their asking rents to secure tenants,” she said.

“It’s also taking longer to lease a property, with the median time on market rising more than 50 per cent over the quarter.”

Broome, Esperance and Busselton recorded low to moderate increases in their median weekly rent prices, while rents were stable in Albany, Bunbury, Geraldton, Kalgoorlie-Boulder and Karratha.

“Conditions vary across the regions and investors need to do their research before investing,” Ms McKenzie said.

“For example, in Bunbury, members believe rent prices have reached an affordability ceiling and any further growth will be low,” she said.

“There has also been a reduction in corporate tenancies following the completion of the Bunbury bypass and recent layoffs at the lithium processing plant.

“However, there is still healthy demand for properties, but those priced over $650 per week are taking longer to rent.

“Broome is seeing more enquiries from prospective tenants in the lead up to the tourism season, and strong demand from corporate and government tenants looking to house staff.

“Rent prices increased 5 per cent in the March quarter and may increase further in the June quarter.”

Ms McKenzie said there were investment opportunities in regional centres like Karratha and Esperance, where REIWA members said the availability of rental stock was low.

“Esperance saw an exodus of investors a few years ago, with many properties going to owner-occupiers,” she said.

“Demand is strong – local businesses have been purchasing properties to house staff and they cannot find a rental – but rising sales prices are impacting yields and creating a barrier to investment.

“In Karratha, vacancies are filling quickly. For some agencies, the majority of their leases are to corporate tenants, with demand varying between family homes and two-bedroom, two-bathroom dwellings.

Over the year, Esperance recorded the most growth, with its median rent price increasing 57.9 per cent to $600 per week.

However, Ms McKenzie said rent price growth in Esperance reflected challenging market conditions rather than a broad increase in rental prices.

“Very few properties are being advertised for rent – many tenants are staying where they are, either to avoid the challenge of finding another property or because the construction of their new home is taking longer than expected,” she said.

“Some owners have also withdrawn properties from the market to accommodate family moving to the area.

“Our members report properties are being leased off-market to those already on agencies’ databases, and therefore they don’t show in the rental listings data.

“Those that are advertised are generally larger or furnished properties, or in higher price brackets, and this is reflected in the strong annual increase in the median rent price.”