Renovation Surge in Perth as Homeowners Sidestep Buying Amid Supply Crunch
In 2026, property owners across Western Australia are increasingly opting to renovate their existing homes rather than sell and buy new ones, driven by cost savings and a severe shortage of housing stock in Perth. Industry experts report that this trend is gaining momentum as moving house becomes a luxury many can no longer afford.
Bruce Sertorio, managing director of Sertorio Homes and a registered builder, explains that many people are "doing the numbers" and finding it more economical to invest in their current properties. He notes that the high costs associated with moving, including stamp duty fees ranging from $80,000 to $100,000, agent commissions, and moving expenses, make renovation a more attractive option. Additionally, the competitive market with low stock levels adds to the hassle of buying and selling simultaneously.
High Demand for Renovations in Premium Suburbs
Kyle McGregor, director at Lux Interiors in Claremont, confirms that demand for renovations is surging. His firm, which specializes in established homes, sees clients recognizing the long-term value of upgrading their properties. Many homeowners in the western suburbs love their locations and seek extra space and comfort, choosing to reinvest in their homes rather than compromise on a new purchase that may not meet their needs.
McGregor cites a recent project in Crawley where clients spent approximately $1.5 million on extensive renovations, including a new kitchen, wine room, master bedroom, and multiple living areas. He emphasizes that renovating allows for personalization and can be more cost-effective when factoring in stamp duty and other fees associated with buying an already renovated home.
Market Dynamics and Supply Constraints
Vivien Yap from Vivien Yap & Co in Dalkeith highlights the ongoing supply crisis, with only 3,036 properties for sale in the Perth metropolitan area—a figure about 40% lower than the previous year. Cost-of-living pressures, such as rising interest rates and fuel prices, further impact buyer confidence and borrowing capacity, sustaining competitive conditions in the market.
Jake Polce, associate director at Duet Property in Nedlands, observes that well-executed renovations can be excellent investments, commanding premium prices at sale. He points to the recent sale of 89 Thomas Street in Nedlands, a fully renovated character home that achieved a record price of $5.45 million. However, Polce cautions that buying and selling in the same market can be neutral or advantageous, as sellers also benefit from high prices.
Costs and Considerations for Renovators
Sertorio details that typical renovation projects, such as adding a master bedroom, ensuite, and kitchen, can cost between $500,000 and $650,000 for a 90-square-meter addition. He also notes a growing trend in building granny flats, priced at $250,000 to $300,000, and second-storey additions for parents' retreats. These options allow families to accommodate children staying home longer due to housing affordability issues.
McGregor adds that rising interest rates and low stock contribute to the reluctance to move, making renovation a more efficient investment in premium locations. While construction costs can be high and timelines may extend, fully renovated homes in the western suburbs are performing exceptionally well, appealing to time-poor buyers willing to pay for convenience and lifestyle.
Overall, the renovation boom reflects a strategic response to Perth's property supply crisis, offering homeowners a controlled and rewarding path to enhance their living spaces without the financial and logistical burdens of moving.
