Perth’s rental market appears to have stabilised after three years of “challenging conditions”, according to data from REIWA.com.au.
REIWA President, Hayden Groves, believes these results indicate that “Perth’s rental market officially found its floor in 2017.”
“After a prolonged period of falling rents, soaring listings and record high vacancy rates, the market has strengthened.
“The December 2017 quarter results signal a stable market, which is welcome news for landlords and property investors,” said Mr Groves.
- Median rent price
The median rent price remained steady at $350 per week during the December 2017 quarter.
According to Mr Groves, this is the “third consecutive quarter” in which the median rent price has stayed at $350. However, REIWA data also found that annually the median rent has declined by $10 per week.
REIWA data also revealed the top five suburbs for median rent price growth in the December 2017 quarter:
- Mindarie – $565 per week
- Attadale – $455 per week
- Bicton – $370 per week
- Shelly – $430 per week
- Shoalwater – $295 per week
“Perth’s median rent stabilised considerably in 2017. Where rents were once declining every quarter, we’ve now observed nine months of steady prices,” said Mr Groves.
“Although there was a small decline between the December 2017 and December 2016 quarters, this is still a significant improvement on the year prior when Perth’s overall median rent declined $40 per week between the December 2016 quarter and the December 2015 quarter.
Annually, the rate of decline has slowed considerably which is pleasing,” said Mr Groves.
- Leasing activity
13,555 rental properties were leased in the December 2017 quarter in Perth, according to REIWA data.
The Perth suburbs with the greatest improvement in leasing activity volumes for this period:
- Piara Waters
“Despite the traditional lull of the festive season, leasing activity only declined 1.6 per cent during the December 2017 quarter.
“Tenants remain very active and it’s good to see that leasing activity hold up well throughout the holiday season,” said Mr Groves.
- Rental listings
8,912 properties were listed for rent over the December 2017 quarter in Perth, according to REIWA data.
This figure has fallen compared the rental listing peak of 11,300 in 2016.
“Listings have declined 8.4 per cent on a quarterly basis and are down 13.9 per cent compared to the December 2016 quarter,” said Mr Groves.
“These considerable declines are likely due to new dwelling commencements slowing which has resulted in stock being soaked up.
“Another contributing factor is the improvement in population growth into the state, which lifted to 0.84 per cent in the year to June 2017.
“The rental market is generally the first place to feel the effect of population growth, as new entrants into the state soak up rental stock first,” said Mr Groves.
- Average leasing days
The number of average listing days in Perth in the December quarter has improved, taking 49 days on average to find a tenant. This is five days faster than the time taken in the September 2017 quarter.
This was also an improvement of three days compared to the December 2016 quarter.
“Healthy leasing activity and declining listings has increased demand, which means tenants are needing to act faster to secure a rental.
It also shows landlords are listening to the advice of their property managers and pricing their properties competitively from the start,” said Mr Groves.
- Vacancy rate
In more optimistic news, Perth December 2017 quarter vacancy rate was recorded to be 5.5 per cent, the lowest level in over two years (September 2015 quarter).
“Perth’s vacancy rate is the lowest it has been in more than two years. It is now down from 6.9 per cent in the September 2017 quarter and from 6.4 per in the December 2016 quarter, which is significant.
“Perth’s rental market has improved across the board in recent times which has had a very positive effect on the vacancy rate,” said Mr Groves.