"Sadly, at that location police have located the bodies of a number of deceased people including women and children," WA Assistant Police Commissioner Paul Steel said.
"This is a tragic event and it will no doubt have an impact not only the family and friends of the deceased but for the whole of the community [and] those first responders who are faced with attending a scene with multiple deceased people," he said.
"It does send a ripple through the community of Western Australia."
He did not confirm the exact number of dead, nor did he detail what the relationship was between the man in custody and the deceased.
Steel said the investigation was still at a "very early stage".
"We are three hours into this investigation, I have no further detail in relation to those who are present at the location," he said.
A distraught neighbour told WA Today she regularly saw children playing in the front yard of the house. "It's just so sad, they've got primary school-aged kids and I thought it just couldn't be," she said. "How could someone do that ... It's sickening to think someone could do that."
Another neighbour told WA Today she would often wave and say hello as she walked past. "It's taken us by complete shock," she said.
The incident came months after seven people died in Osmington, in the state's southwest.
The shooting deaths of Katrina Miles, her parents Cynda and Peter Miles, and her four children were determined to be murder-suicide.
In July, Kiwi mum Michelle Peterson, 48, and her children Bella, 15 and Rua, 8, were killed in the suburb of Ellenbrook.
