by Hayden Groves – REIWA President https://reiwa.com.au/
The Perth rental market produced mixed results during the June 2018 quarter, with reiwa.com data showing median rent was stable, leasing activity was subdued, listings for rent declined and average leasing times improved. Perth’s overall median rent price held at $350 per week for a fifth consecutive quarter. After experiencing free-falling rents between 2014 and 2017, the stability of the last 12 months is a welcome change and should provide landlords with confidence. Pleasingly, while the overall median rent was unchanged this quarter, there were 102 suburbs which recorded median rent price growth during the June quarter. The five best performing suburbs were Attadale (up 75.8% to $580 per week), Jolimont (up 50.9% to $423 per week), Burswood (up 33.3% to $480 per week), Booragoon (up 28.4% to $475 per week) and Hamersley (up 28.4% to $430 per week).
There were 12,633 properties leased last quarter, which is 10.4% fewer than the March 2018 quarter and 4.1% fewer than the June 2017 quarter. This could be due to slowing population growth, with the latest figures showing migration into Western Australia has declined 5%. Additionally, with the median rent stable for a prolonged period, tenants are choosing to stay in their current homes, no longer able to negotiate a cheaper rent in an alternate property as readily as they were able last year. It is also worth noting the change in seasons has likely impacted activity levels this quarter, as the rental market often slows throughout winter before picking up again in spring. Despite the overall reduction in leasing activity, reiwa.com data shows there were 71 suburbs which saw leasing activity increase, such as Brookdale (up 88.9%), Ocean Reef (up 75%), Kallaroo (up 63.6%), Parmelia (up 48.3%) and Hamersley (up 46.2%).
Rental listings continued to decline in the June quarter, down 2.5% compared to the March quarter, and 22.9% compared to the same time last year. A key driver for this fall in listing volumes is the slowdown of new dwelling commencements. With less new properties coming onto the market, existing rental stock is being soaked up, putting downward pressure on available rental stocks.
And finally, it was two days quicker to find a tenant in the June quarter than it was during the March quarter, and six days faster than it was this time last year, which is good news for property owners.
Overall, the Perth rental market is a picture of stability, with rents no longer falling, listing stocks close to parity and vacancy rates falling back into line with long-term averages.
On its current trajectory, rents could begin to rise again by the end of the year.