For the fourth consecutive month, Perth’s rental market has remained stable, with median rents showing no change since March.
The latest data from the Real Estate Institute of Western Australia (REIWA) indicated that the median weekly dwelling and house rents held steady at $650 in June, while the median weekly unit rent remained at $600.
REIWA CEO Cath Hart (pictured above) highlighted indications of a slow shift in the rental market.
“Rents have been stable for a number of months, properties are taking longer to lease, and the number of listings continues to rise,” Hart said. “While the change isn’t reflected in all the data – for example, the vacancy rate remains at a near-record low – our members at the coalface are reporting that conditions are slightly less frenzied than they were previously.”
Despite these signs, Hart cautioned that the market is not entirely out of the woods yet due to strong population growth and low new housing completions.
“Today’s numbers are, however, encouraging and on the pathway to a more balanced rental market,” she said.
Hart attributed the change to several factors, including self-moderation of demand for rental homes and an increase in new supply in some areas.
“We’re seeing some ‘self-moderation’ of demand for rental homes as tenant household sizes increase and as people avoid renting where possible,” she said. “We are also finally seeing an increase in new supply in some areas, and we hope to see this trend continue.”
Despite the stability in June, rents are still significantly higher compared to a year ago. The median weekly dwelling rent rose by 18.2% year-on-year, with the median house rent increasing by 12.1% and the median unit rent by 14.3%.
“REIWA’s March quarterly update forecast the rate of rent price growth would slow over 2024 and we are starting to see that now, particularly for houses,” Hart said.
June saw 2,484 properties available for rent on REIWA’s website, marking a 3% increase from May and a 16.8% rise from the same time last year.
“The number of rental listings has been slowly increasing since February,” Hart said. “The last time they were at similar levels was April 2022.”
Homes leased in a median of 18 days during June, two days slower than in May and a year ago.
“Earlier this year it took 15 days to lease a home; the slowdown reflects the moderation in demand and suggests slightly less competition for properties,” Hart said.
In contrast to the rental market, property prices in Perth continued to rise in June.
Houses reached a new record median sale price of $660,000, up 1.5% from May and 17.9% higher than June 2023. The median unit sale price also saw an increase, rising by 1.3% to $440,500.
“While house prices have been setting new records for some time, units remain below the previous record of $450,000 set in 2014,” Hart said. “Based on current growth rates, they could exceed that in the next few months.”
Active listings for sale settled at 3,265 at the end of June, marginally lower than May but 38.9% lower than a year ago.
“There is a perception there are no homes for sale, but when we look at the data we have seen more properties come to market in the first six months of 2024 than the same period last year,” Hart said.
With homes selling quickly, Hart advised potential buyers to get their finances approved before entering the market.
“With competition so high, we recommend potential buyers get their finance approved before they hit the market to put them in a strong position when they make an offer," she said.
The Perth rental market shows early signs of moderation, but challenges remain as population growth and housing shortages persist.
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