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‘Recipe for disaster’: WA rental market set to worsen

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‘Recipe for disaster’: WA rental market set to worsen

by Emma Ryan 15 September 2020 1 minute read

New tenants are finding it increasingly difficult to secure a property, spurring what’s being dubbed a “recipe for disaster” by the state’s real estate body.

‘Recipe for disaster’: WA rental market set to worsen
September 15, 2020

The Real Estate Institute of Western Australia (REIWA) said the state’s rental market is expected to worsen for new tenants after the last month saw vacancy rate drop again by 0.3 per cent.

This, combined with the extension to the emergency tenancy laws by the WA government, is furthering the struggle for tenants who are yet to find a property. 

REIWA president Damian Collins said that in just two months, PerthPerth, TAS Perth, WA’s vacancy rate has gone from 2 per cent to 1.3 per cent and is expected to continue lowering over the coming months.  

“The McGowan government’s shortsighted decision to extend the emergency period for all tenancies is making a difficult problem even worse,” Mr Collins said. 

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“Unfortunately, sitting tenants are unlikely to move or adjust household size as they are paying below market rents. In addition, we are seeing an influx of people trying to find a new rental property in a market with a very low vacancy rate.” 

Instead of a blanket extension, Mr Collins said criteria should have been added to the legislation so that only those impacted financially by COVID-19 received the support that they need.  

“Right now, investors are sitting on the sidelines partially due to the COVID-19 residential tenancy laws, and by extending the legislation on all properties, it means investors are likely to continue to stay out of the market, which will further reduce supply at the worst possible time,” Mr Collins said. 

“It’s not too late for the McGowan government to change their position, as we need to get investment confidence back, so investors bring the badly needed supply of rental properties back into the market. 

“Without any change in the policy, it’s feared that a rental shortage will quickly turn into a rental crisis.” 

‘Recipe for disaster’: WA rental market set to worsen
‘Recipe for disaster’: WA rental market set to worsen
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About the author

Emma Ryan

Emma Ryan

Emma Ryan is the deputy head of content at Momentum Media.

Emma has worked for Momentum Media since 2015, and has since been responsible for breaking some of the biggest stories in corporate Australia, including across the legal, mortgages, real estate and wealth industries. In addition, Emma has launched several additional sub-brands and events, driven by a passion to deliver quality and timely content to audiences through multiple platforms.

Email Emma on: [email protected]Read more

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