Perth vacancy rate drops below three per cent in December quarter
The Perth rental market continued its recovery in the December 2018 quarter, with the vacancy rate declining to 2.8 per cent.
REIWA President Damian Collins said the Perth vacancy rate was the lowest it had been in more than five years.
“The last time the Perth vacancy rate was this low was in March 2013. The rapid improvement we’ve observed in the last 18 months is impressive, especially considering the vacancy rate peaked at 7.3 per cent in June 2017 – the highest it’s ever been.
“Now that the vacancy rate is below three per cent, we can safely say the market is in a recovery phase with landlords now the beneficiary of the current rental environment,” Mr Collins said.
Median rent price
Perth’s overall median rent price continued to hold at $350 per week during the December quarter.
“The median rent in Perth has been stable for seven consecutive quarters, which is the longest stretch of stable rents Perth has seen since reiwa.com first started capturing rental data in 2001,” Mr Collins said.
Despite the overall market remaining stable, there were 105 suburbs that recorded an increase in price, with North Coogee, Churchlands, Ardross, Daglish and Munster the top performers.
“When we drill down further and isolate houses and units, the results of the December quarter are very pleasing for landlords, with both houses and units experiencing increases in rents. The median house rent increased $10 per week to $360 during the December quarter, while the median unit rent increased $5 per week to $325.
“This improvement didn’t translate into an increase in the overall median as there were more units leased during the quarter than houses, which has kept the overall median stable.”
“If the rental market continues on its current trajectory, we should see Perth’s overall median rent price increase in 2019, which will be a welcome development for landlords” Mr Collins said.
There were 12,917 properties leased in Perth during the December quarter.
“Leasing activity slowed during the December quarter, as the festive season saw less people out and about searching for properties. This is very common at this time of year, with activity tending to decline in December before increasing again early in the New Year,” Mr Collins said.
reiwa.com data shows the five suburbs to experience the biggest increase in leasing activity (percentage wise) were Kallaroo, Daglish, Melville, Merriwa and Hilton, while the suburbs with the highest volume of leased properties were Perth, East Perth, Scarborough, Baldivis and Maylands.
“We expect to see a notable increase in leasing activity in 2019, with REIWA members already noticing a significant uptick in the volume of enquiries for rentals in January,” Mr Collins said.
Listings for rent
There were 6,865 properties for rent in Perth at the end of the December quarter.
“Listings continue to reduce, with the December quarter figure down 10 per cent on the September quarter and a substantial 27 per cent on the same time last year,” Mr Collins said.
“The sharp decline in listings is a driving force behind why Perth’s vacancy rate has improved. With population growth in WA on the incline and fewer new-building projects commencing, listing stock is being absorbed more quickly.”
Average leasing time
It was four days faster for landlords to find a tenant for their rental in the December quarter than in the September quarter.
“The average time it took to lease a property reduced to 44 days, down from 48 days in the September quarter and 50 days in the December 2017 quarter. With fewer available rentals on the market, competition amongst tenants has increased requiring them to act faster to secure a lease,” Mr Collins said.
“The signs for 2019 look very promising. The rapidly improving rental landscape combined with Perth’s favourable buying environment should hopefully see more investors enticed back to the market.”