WA forecasts slower economic growth until 2030
Sydney (7 May)
Western Australia’s (WA) economy will grow by 2.25% over the 2026-27 financial year to 30 June, down from 3.25% in 2025-26 because of slower export growth, forecasts from the WA Government’s 2026-27 Budget show.
It will then grow by 2% annually from 2027-28 until the end of the decade, according to forecasts released on 7 May.
But the WA Government’s forecasts are highly uncertain. “The [Budget] outlook is particularly sensitive to the persistence of inflation, the duration of restrictive financial conditions, the pace of adjustment in the housing market, developments in key commodity markets, and potential supply chain disruptions,” it said.
The WA Government expects the state’s economic growth rate to fall because of reduced net export growth. It expects the state’s net export growth rate to fall each year between 2025-26 and 2029-2030, from 3% to 0.25%, forecasts show.
WA’s resource firms – including iron ore exporters – plan to hold production levels steady and focus on decarbonisation projects, the Government said.
Rio Tinto plans to develop iron ore mines with a combined capacity of 130 million tonnes per year of ore to replace older sites, rather than to increase its production capacity, over the next decade. Fortescue also cut back on new mine development spending in 2025-26.
Housing investment will support WA’s economy until the end of the decade. The state’s government expects dwelling investment to grow by 5.25% in 2026-27 and at an average rate of 2.7% from 2027-28 until 2029-2030, forecasts show.
Elevated land sales, population growth, and building approvals support the forecast, it said.
WA’s government partnered with the Federal Government to invest A$2 billion into housing and housing-related infrastructure projects on 3 May, the governments said in a joint statement. The investments will support 34,000 new dwellings, including 11,000 units for first home buyers.
House prices in Perth will rise by 9% in 2026-27 and 4.6% in 2027-28, before dropping to just 0.5% by 2029-30, forecasts show.
“Lower population growth, alongside increasing housing supply as more dwellings are completed, is anticipated to support greater stability in prices [towards the end of the decade],” the Government said.
WA’s annual population growth rate will plateau at 1.5% in 2027-28, down from 1.8% in 2025-26, forecasts show. The Government expects population growth to slow because of increased emigration, reduced skilled migration, and reduced working holiday tourism, it said.
By Avinash Govind