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The increasing cost of renting could prompt more renters to consider property ownership, according to RE/MAX WA managing director Geoff Baldwin.
Tight rental conditions and rising rents have historically led to greater sales volumes, Mr Baldwin said, and he is starting to observe this trend again.
“The vacancy rate locally has dropped to around 2.8 per cent, down from over 4 per cent in January, putting pressure on rents and prompting people to again seriously consider the buying option,” Mr Baldwin said.
“With property prices at a four year low and interest rates stabilised, people who have been renting are now weighing up the option to buy rather than to pay higher rents and be forced to choose from a decreasing rental pool.
“A tightening rental market has been a strong indicator of improving sales conditions in every cycle over the past fifty years and this cycle is sure to be no different.”
Mr Baldwin’s comments echo those of Aussie’s John Symond yesterday.
According to Mr Symond many property buyers could be looking at weekly rents comparable to loan repayments.
“It is worth investigating the options of buying a home versus paying rent to a landlord as potential buyers may be pleasantly surprised.”