The Perth unit types delivering the best returns for investors

There are many decisions to make when investing, for example are you looking for capital growth, regular income from rent, or strong yields? While houses generally outperform units for capital growth, units usually provide a better rental yield.

Five years ago, the difference between the two was relatively small, just 0.4 percentage points. In the 12 months to March 2025, however, units recorded a rental yield of 6.2 per cent compared to 4.5 per cent for houses.

The term ‘unit’ is quite broad, and the unit market can be broken down into four categories: apartments, home units, townhouses and villas (full property type description at end of article). This month, we’ve looked at which unit types are currently providing the strongest results for investors.

Rental and capital growth

All unit types saw capital growth over the past year.

Villas recorded the most growth over the past 12 months, with the median sale price rising 25.6 per cent to $550,000. Home units were the next best performer, with median sale price growth of 22.1 per cent over the same period.

From March 2020 to now, villas recorded the most growth of any unit type, with the median sale price increasing 69.2 per cent. Home units were again the second top performer, with the median sale price rising 44.6 per cent. Long term, apartments recorded the lowest rate of price growth at just 14.1 per cent.

All unit types saw an increase in their median weekly rent over the year. Home units and villas led the way, with median weekly rents rising 22.2 per cent to $550 and 18.2 per cent to $650 respectively.

Since 2020, median weekly rents for home units and villas have more than doubled.

Days on market

While the median leasing time for units increased 14 to 15 days in the year to March 2025, it remained well below the 30 days recorded in 2020.

Villas and home units leased the fastest, with a median of 14 days each. Apartments and townhouses were only one day slower at 15 days.

Rental yield

When it comes to rental yield, villas and home units delivered the highest results for investors in the year to March 2025 with yields of 6.1 per cent. Apartments followed closely behind at 5.7 per cent.

Apartments saw the most improvement in yields over the past five years, which is a reflection of their lower rate of capital growth.

In summary, villas and home units stood out over the past year for investors, recording the highest growth for both sale and rent prices, as well as delivering the strongest yields.

The vacancy rate in Perth rose to 2.5 per cent in March 2025. This was 0.2 percentage points higher than the 2.3 per cent recorded in February.

The last time the vacancy rate was 2.5 per cent was September 2019. 

REIWA considers a balanced market to have a vacancy rate between 2.5 and 3.5 per cent, but reaching this milestone did not mean the challenges of the past few years would suddenly disappear, REIWA President Suzanne Brown said.

“WA is still recording strong population growth, although not as strong as previous years, and the estimated number of rentals remains about 5 per cent below the peak recorded in February 2021,” she said.

“These factors are maintaining pressure on the rental market as a whole. There will still be some increases in Perth rent prices in the months ahead and challenges finding rental properties, depending on where you are looking.”

Ms Brown stressed that when it comes to choosing an investment property, investors should do their own research and consider price growth, rental yield and overall rental demand for a particular property type and area, as well as their investment strategy.

Unit definitions:

Apartment: Dwellings with no private grounds in a multi-storey complex and usually share a common entrance, foyer or stairwell. Apartment complex’s generally have lifts and common amenities such as a pool, gym or garden. 

Home unit: Single-level dwellings in a multi-residential setting where the complex is no more than two storeys.

Townhouse: Two/three-storey dwellings with their own private grounds. They are in a multi-residential setting and have no other dwelling above or below. They are either attached in some structural way to one or more dwellings or are separated from neighbouring dwellings by less than half a metre.

Villa: Single-level dwellings with their own private grounds. They are in a multi-residential complex and have no other dwellings above or below.