Hotspotting: Perth’s three-year run as the nation’s property leader is over

Perth’s three-year run as the nation’s fastest growing property market is over — with investment set to return to the east coast.

That’s according to leading industry forecaster, Hotspotting, which claims Perth has shown the first signs of a slowdown after a stellar run in recent years.

The tool’s Price Predictor Index for summer 2023 said only 54 per cent of Perth suburbs are now seeing consistent property value increases, down from 79 per cent earlier this year.

It does not forecast specific price changes.

Hotspotting director Terry Ryder said Perth had simply run its course, with investors turning their attention to Brisbane, Sydney and Melbourne, which will be the property hotspots this summer.

“As Sydney, Melbourne, Brisbane, and several regional markets move into overdrive, Canberra and Darwin are stuck in neutral and Perth — after being a nation-leading growth market for three years — is now in reverse,” he said.

“The Perth market is showing the first signs of fading and has lost its position as a national growth leader — although it will take time before it shows up in the price data.”

Hotspotting has proven to be highly influential with east coast investors and is believed to have been behind Armadale’s phenomenal price growth.

Property prices in the suburb in Perth’s south-east, have risen by as much as 20 per cent this year after the tool highlighted the suburb as a “hotspot” a year ago.

Hotspotting predictions are based on the number of sales of houses and units in an area, claiming there is a correlation between sales volumes and price movements, albeit with a time lag.

Hotspotting general manager Tim Graham said Melbourne was the new property leader among capital cities.

“Melbourne, Brisbane and Sydney all have 84 per cent to 87 per cent of their suburbs with positive momentum in their markets, which is a dramatic turnaround since the start of the calendar year in 2023,” he said.

“But next in the national rankings are regional Queensland, regional South Australia, regional WA and regional Victoria, indicating that markets outside of the capital cities continue to deliver growth.”

Bunbury is the only WA market deemed to be in Hotspotting’s top ten markets.

While Melbourne tops the chart, Canterbury-Bankstown in NSW has been nominated as the next promising market, with 16 of the 22 suburbs in the area tipped for price growth.

While Hotspotting does not predict prices, WA forecaster Damian Collins recently said some local suburbs will outperform, with double-digit growth of ten per cent in 2024.