The Perth rental market in the June quarter has been an overall positive sign for investors, with faster leasing times and declining listings, indicating demand is getting stronger in the Western Australian capital city.
The data, according to the Real Estate Institute of Western Australia (REIWA), also points to stable dwelling rents yet subdued leasing activity, which REIWA president Hayden Groves labelled as mixed.
“Although the worst of the downturn appears to be behind us, it’s not uncommon to see results fluctuate as the market transitions into a recovery,” Mr Groves said.
“The change in seasons has also contributed to this quarter’s results, with the cooler weather impacting activity levels. We tend to see activity slow during the winter months before picking up again in spring.”
’s median rent held steady over the June quarter at $350 per week for the fifth quarter in a row.
“Rent prices have been stable since the June 2017 quarter, which is pleasing. After experiencing prolonged periods of freefalling rent prices, the stability we’ve observed over the last 12 months is a welcome change and should provide landlords with confidence,” Mr Groves said.
Despite the stagnation, there are 102 suburbs in Perth that saw median rent price growth.
“The five best performing suburbs for rent price growth in the June quarter were Attadale (up 75.8 per cent to $580 per week), Jolimont (up 50.9 per cent to $423 per week), Burswood (up 33.3 per cent to $480 per week), Booragoon (up 28.4 per cent to $475 per week) and Hamersley (up 28.4 per cent to $430 per week),” Mr Groves said.
The data shows leasing activity declined 10.4 per cent over the June quarter to 12,633 properties being leased, showing that tenants are more likely to be renting for the long term.
“The latest population figures for WA shows migration into the state has declined by five per cent, which has likely influenced leasing activity levels in Perth. The rental market feels the impact of changes in population first, with new migrants to the state relying on rental accommodation to set themselves up,” Mr Groves said.
“Tenants are also not moving as much as they were when prices were declining and there were good deals to be had. After 12 months of stable rent prices, lower activity levels suggest tenants are feeling confident rental prices have found a floor and therefore more inclined to stay put.”
There were 71 suburbs though that saw leasing activity improve, providing an entry point for investors who are considering entering the Perth market.
“The five suburbs which saw the biggest improvement in activity were Brookdale (up 88.9 per cent), Ocean Reef (up 75 per cent), Kallaroo (up 63.6 per cent), Parmelia (up 48.3 per cent) and Hamersley (up 46.2 per cent),” Mr Groves said.
Listings for rental properties were also down 2.5 per cent for the quarter to 8,293 properties, which is 22.9 per cent lower than the same quarter last year.
“Rental listings in the metro area have declined significantly over the last 12 months, with far fewer properties available for rent this year compared to last,” Mr Groves said.
“A key driver for this improvement is the slowdown of new dwelling commencements. With less new properties coming onto the market, existing rental stock is being soaked up faster, putting downward pressure on listing volumes.”
The rate properties are being leased out is improving at 46 days on average over the June quarter, two days faster than the previous quarter and six days faster than the same quarter last year, which Mr Groves said was a “notable improvement”.
“Although leasing activity softened during the June quarter, activity levels remain above long-term averages. This, combined with rapidly decreasing listings means tenants are needing to act faster to secure a rental property,” he said.