Perth’s rental market produced mixed results in the June 2018 quarter, with stable dwelling rents, subdued leasing activity, declining listings and faster leasing times.
REIWA President Hayden Groves said the June quarter’s mixed results were not unusual given Perth’s rental market was in a transitional phase.
“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.
“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,” Mr Groves said.
Median rent prices
Perth’s overall median rent price remained stable in the June quarter, holding at $350 per week for a fifth consecutive quarter.
“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.
Although Perth’s overall rent was stable, reiwa.com analysis shows 102 suburbs across the metro area did experience 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.
“Other top performing suburbs were Karawara, North Fremantle, Mount Nasura, Mount Claremont and Hillarys.”
There were 12,633 properties leased during the June 2018 quarter.
Mr Groves said leasing activity had declined 10.4 per cent over the June quarter and was down 4.1 per cent compared to the June 2017 quarter.
“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.
“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,” Mr Groves said.
Despite the overall reduction in leasing activity, reiwa.com data shows there were 71 suburbs across the metro area which saw leasing activity improve.
“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).”
There were 8,293 properties for rent in Perth at the end of the June 2018 quarter.
Mr Groves said this figure was 2.5 per cent lower than the March 2018 quarter figure and 22.9 per cent lower than the June 2017 quarter.
“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.
“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,” Mr Groves said.
Average leasing time
It took 46 days on average to find a tenant in the June quarter, which is two days faster than the March quarter.
“It is also six days faster to lease a property than it was during last year’s June quarter, which is a notable improvement,” Mr Groves said.
“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.”