The Perth rental market is leading the way in the housing market recovery, with vacancy rates at their lowest level since 2014 according to REIWA data.
Leasing activity is up, median rents remained stable, stock levels have reduced, average leasing times were faster, and the vacancy rate has plummeted to its lowest level in more than four years, according to the Real Estate Institute of Western Australia (REIWA) data for the September quarter.
“The rental sector is really leading the charge in the Perth property market recovery. The September 2018 quarter results are very encouraging and should provide landlords and investors with a lot of confidence,” REIWA President, Damian Collins said.
Perth’s vacancy rate declined to 3.9 per cent over the September quarter, the lowest level the city has experienced since March 2014.
“With all key market indicators improving during the September quarter, Perth’s vacancy rate has now fallen below the 10 year average,” Mr Collins said.
“Slowly but surely we are moving towards parity in the Perth rental market, with improved conditions across the board meaning there is good opportunity for tenants and landlords to benefit simultaneously.”
The overall median rent price held firm at $350 per week.
Mr Collins told WILLIAMS MEDIA this is the longest period of stable rents the Perth rental market has experienced since before 2001.
“Prices remain affordable for tenants, but the last 18 months have provided landlords with much needed consistency,” Mr Collins said.
“If we isolate this quarter’s leased properties to houses, our analysis shows the median house rent actually increaed to $360 per week, which is a great sign overall for the market.
The five best performing suburbs for overall rent price growth was Kallaroo (up 39.5 per cent to $530 per week), City Beach (up 25.9 per cent to $850 per week), Gwelup (up 24.5 per cent to $623 per week), Cottesloe (up 23.5 per cent to $605 per week) and Alexander Heights (up 21.9 per cent to $390).
“Other top performers were Connolly, Inglewood, Ashby, Beaconsfield and Wembley.”
Leasing activity was also up.
“Tenants were a lot more active this quarter than last, with 132 suburbs across the metro area recording increases in the number of properties leased,” Mr Collins said.
The five suburbs with the highest volume of properties leased during the quarter were Perth (346), East Perth (343), Scarborough (319), Baldivis (243) and Maylands (235).
“South Perth, Rockingham, West Perth, Rivervale and Midland also performed well,” Mr Collins said.
“Activity remains high in the rental market. Provided landlords are listening to the advice of their property manager and pricing their rental in line with market expectations, they have a very good chance of securing a tenant.”
Less properties were listed for rent during the September quarter, with stock levels down 11.9 per cent compared to the June 2018 quarter.
“This sharp decline can be attributed to a combination of leasing activity improving and new dwelling commencements slowing. With less new properties coming onto the market, rental stock is being absorbed at a quicker pace, which has put downward pressure on listing volumes,” Mr Collins said.
On average, it took landlords 46 days to find a tenant for their rental property.
“This is one day faster than the June 2018 quarter and eight days faster than the September 2017 quarter,” Mr Collins said.
“A combination of increased tenant activity and lower listing levels has had a positive impact on average leasing times for landlords, with tenants needing to act quicker to secure a rental.”