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Construction has not dented rents

STRONG building activity during 1999 has not translated into a drop in rents indicating there is no over supply in new homes according to BGC housing director Julian Ambrose.

According to Mr Ambrose, rental prices for a four bedroom homes in Perth increased by nearly 10 per cent in 1999 to $203 a week which was the largest increase of any type of residential property.

“Significantly, most growth in rental prices occurred during the last quarter of 1999 which underlines the resilience of rental market and the overall housing market,” Mr Ambrose said.

“Strong rental returns means that investors and first home buyers, in particular, will continue to be attracted to the new housing market during 2000.

“All categories of residential properties recorded increases in rental values during 1999,” he said.

“Overall, the rental vacancy rate in Perth increased from 2.7 per cent to 2.9 per cent during the year which, historically, is still at a low level.

“Houses recorded a vacancy rate of 2.6 per cent which was the lowest vacancy rate for all categories,’ he said.

Mr Ambrose said the building sector was undergoing a market correction with the number of new home enquiries falling during the first two months of 2000.

“However, we anticipate the new home building market will improve during the second half of 2000,” Mr Ambrose said.

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