New data shows that leasing activity has risen in this recovering capital city market as the vacancy rate has hit a six-year low during the March quarter.
Data from the Real Estate Institute of Western Australia found that leasing volumes rose by 9 per cent over the March 2019 quarter.
REIWA president Damian Collins said the rental market inhas been recovering, and landlords are set to benefit.
“Almost all key market indicators showed improvement during the March quarter, causing the Perth vacancy rate to decline to 2.5 per cent,” Mr Collins said.
“This is the lowest quarterly vacancy rate we’ve seen since the March 2013 quarter, putting the Perth rental market in favour of landlords.”
Overall, the median rental price remained at $350 per week, the ninth quarter in a row to do so.
“Although overall rents are stable on both a quarterly and annual basis, the median house ($360 per week) and unit ($330 per week) rents are both up $10 per week compared to the March 2018 quarter,” Mr Collins said.
“[REIWA] analysis also shows there were more units leased this quarter than last, which suggests the composition of leased stock is impacting price movement in the overall market.”
Even though the median rent saw no movement, 29 per cent of Perth suburbs saw a rental increase over the quarter.
Mr Collins added that if these rental trends increase, Perth’s stabilised overall median rent could increase.
“If rental market conditions continue on its current upward trajectory, which we expect it to, it’s only a matter of time before we start to see Perth’s overall median rent rise.”
The number of properties leased in Perth over the March 2019 quarter rose from 12,870 last quarter to 14,003, with 42 per cent of suburbs seeing a spike in leasing volumes.
There were 14,003 properties leased in Perth during the March 2019 quarter, up from 12,870 in the December 2018 quarter.
“Seven of the 10 suburbs that saw the biggest increase in leasing activity had a median rent price above the overall Perth rent of $350, with four of those 10 located in the Western Suburbs, suggesting there is particularly strong demand for rentals in Perth’s more affluent suburbs,” Mr Collins said.
With leasing activity increasing, the number of listings decreased by 2 per cent to 6,738 properties, and down by 25 per cent compared to this quarter last year.
“We’ve seen a significant decline in rental listings over the last 12 months, which has played a key role in the rental market transitioning in favour of landlords,” Mr Collins said.
“With less stock available and increased activity, there is more competition amongst tenants to secure their preferred rental.”
Rental properties in Perth saw an average of 42 days on market, a decrease of two days compared to the last quarter and five days for this quarter last years.
“We’ve seen a significant improvement in average leasing times over the last couple of years, since peaking in June 2017 at 57 days,” Mr Collins said.
“Average leasing times are now the lowest they’ve been since March 2015, which is great news for landlords and illustrates that tenants need to act faster to ensure they don’t miss out.”