The dream of building a new home in Perth has become twice as expensive in just six years! New data reveals a staggering surge in construction costs, leaving many wondering if homeownership is slipping further out of reach. It's a stark reality check for anyone looking to build in Western Australia.
Here's the shocking truth: According to figures released by the Australian Bureau of Statistics on Friday, January 31, 2026, the cost of constructing a new home in WA has skyrocketed by an incredible 95.6% since 2019. That's almost double the price! Imagine a home that cost a modest $300,000 to build just six years ago now demanding a whopping $586,800 as of December 2025. This makes WA the state with the most dramatic cost escalation in the entire country.
But this isn't just about new builds; it's also reshaping the entire property landscape. The median price in a record 126 suburbs across Perth has now crossed the $1 million mark. Yes, you read that right – a significant number of suburbs have officially joined the 'million-dollar club'.
And this is the part most people miss: Among the newcomers to this exclusive club is the suburb of Samson, located east of Fremantle. It made its debut after experiencing an astonishing 40.5% surge in its median house sale price, reaching an impressive $1.25 million. Following closely behind are Brentwood with a 37.1% annual growth, Serpentine at 36.8%, Roleystone with 26.3%, and Maylands at 23.1%.
Of course, the perennial favorite, Peppermint Grove, continues to hold its title as Perth's most affluent suburb. At the close of 2025, its median house sale price stood at a considerable $5.1 million, even after a respectable 9.0% growth over the year.
Suzanne Brown, the President of the Real Estate Institute of Western Australia (REIWA), commented on this phenomenon: “Typically, we only see a handful of new entrants to the million-dollar club each year. However, the Perth property market recorded another 12 months of very strong price growth, which saw the median house sale price for Greater Perth rise 13.3% in 2025.” She further added, “This follows 25.0% growth in 2024, when a record 37 suburbs joined the million-dollar club, 34 of which were new entrants. If Perth property prices increase as expected over 2026, we could easily see the million-dollar club reach 150 suburbs at the end of the year.”
But here's where it gets controversial... While many suburbs are soaring into the million-dollar bracket, six have recently seen their median house sale prices dip below this threshold by the end of 2025. Karawara, Carmel, and Bickley are among those that have fallen out of the club. Mariginiup, Hovea, and Millendon also dropped off the list, not due to price drops, but because they had no qualifying sales recorded in 2025. Does this indicate a shift in the market, or are these temporary blips?
Now, let's talk about the root cause for new builds. Shane Garrett, Chief Economist for Master Builders Australia, pointed to the escalating cost of building materials. His data indicates a significant 39.4% increase in building material costs since 2019. The biggest culprits for this surge over the past six years include ceramic products, cement, timber, board, and joinery products.
Matt Moran, CEO of Master Builders Western Australia, expressed his concerns, stating that the rising material costs, coupled with a significant worker shortage already plaguing the industry, are likely to further hinder efforts to resolve the housing crisis. He emphasized, “MBAWA is committed to working with the State Government on pragmatic policies to assist the local industry to build the affordable houses our community needs.” Moran also highlighted the critical need for “focusing on supply-side solutions, such as boosting the building and construction workforce and increasing the availability of land.”
What are your thoughts on these soaring building costs? Do you believe the government and industry are doing enough to address the housing crisis? Let us know in the comments below!
