The property market in Western Australia is experiencing significant upward pressure on prices, particularly in rural and regional areas, due to a surge in buyer demand and a persistent lack of supply. According to Daniel Lloyd-Smith, founder and director of Zephyr Real Estate, this scenario has become more pronounced in 2025, with various segments of the market facing intense competition.
“Desperation among buyers, combined with limited stock, has continued to place upward pressure on prices—particularly in the residential and lifestyle markets,” Mr. Lloyd-Smith stated. The ongoing shortage of new land releases across the state has led to increased competition among various buyer demographics, including first home buyers, growing families, downsizers, and investors vying for established homes.
The influx of interstate buyers, particularly in the investment sector, has further complicated the landscape. This trend has intensified competition, making it increasingly challenging for potential homeowners to secure properties. Mr. Lloyd-Smith noted that the residential property market remains resilient, bolstered by factors such as population growth, tight vacancy rates, and persistent affordability challenges.
Individuals seeking homes have often had to make compromises regarding location, size, or condition to complete a purchase. Conversely, sellers are benefiting from robust competition, with well-presented homes frequently attracting multiple offers and selling rapidly.
Market Dynamics and Lifestyle Appeal
While price growth has not been uniform across all regions, the overall trend has remained positive. The lifestyle property market, in particular, has shown strong performance, reflecting a sustained desire for greater space and a connection to rural life. Buyers in this segment range from farmers looking to divest land holdings as they approach retirement to young families and professionals seeking weekend retreats.
“This consistent demand has helped support strong pricing outcomes, particularly for well-located properties that offer a balance of privacy, accessibility, and livability,” Mr. Lloyd-Smith explained. The enduring appeal of lifestyle properties indicates that many buyers are prioritizing quality of life over proximity to urban centres.
In contrast, the agricultural sector has encountered a slower year in terms of transaction volumes. With fewer listings available, there has also been a noticeable decrease in the number of active buyers. This decline can be attributed to the drier conditions experienced by many producers in 2023, following two years of comparatively strong rainfall.
“Seasonal conditions often play a critical role in buyer confidence, and while interest has softened in the short term, there is potential for renewed activity if conditions improve,” Mr. Lloyd-Smith cautioned.
Future Outlook for Property Prices
Looking ahead, Mr. Lloyd-Smith suggests that a return to more favourable seasonal patterns could bolster buyer confidence in 2026, although this remains uncertain. Despite the reduced number of buyers, agricultural properties that sold in 2025 generally achieved strong prices, highlighting the enduring value of quality farming assets.
There has also been an increase in farming families exploring opportunities outside their traditional regions. Rising land values in established areas, coupled with the need to maintain affordability as operations expand, are prompting some buyers to consider alternative locations.
In summary, 2025 has proven to be another solid year for property prices across most sectors of the Western Australian market. However, the ongoing shortage of supply presents a significant challenge. Mr. Lloyd-Smith emphasized that an increase in listings and new land releases across all markets would alleviate competition, enhance affordability, and support a more balanced and sustainable industry moving forward.
