Perth rental prices tipped to grow

Perth’s residential rentals hit their highest asking price in five years over the December quarter, as available properties continued to dwindle in what has quickly become a landlords’ market.

Domain’s latest rental report found house rents increased by $25 to $420 a week during the December quarter, with units up $10 to $350 per week.

In more positive news for property investors, Perth also recorded the strongest annual growth in asking rents out of all Australia’s capital cities – up 13.5 per cent for houses and 12.9 per cent for units.

“This is the steepest annual jump in rents since Perth hit a price peak in mid-2013,” the report said.

Despite rental prices for houses remaining $70 a week below the mid-2013 peak and units being $100 cheaper, Domain said Perth was no longer the ‘most affordable capital city rental market’.

“Tenants are now operating in a landlords’ market,” the report highlighted.

“The choice of vacant rentals has plummeted 63 per cent compared to last year.

“Rental demand has increased as domestic travel resumes, overseas Australians return, and interstate employees choose to relocate given changing border restrictions.”

The forthcoming cessation of the state government’s moratorium on evictions and rental increases could provide another boost to landlords’ pockets, with more rental price growth anticipated.

Rental supply is also tipped to increase, the Domain report said, pointing to bullish capital growth predictions for Perth’s economy potentially further enticing investors to buy property.

“It may create a shift in tenants adjusting homes to meet their current needs, many of whom are likely to be currently paying rent below market rate,” the report said.  

“New construction will also be boosted by the generous housing stimulus incentives and will assist more first homebuyers to the market removing some rental demand.”

Meanwhile, unit rents fell to 2013 prices in Sydney, while house rents remained at a record high of $550 a week, that growth underpinned by stronger conditions across the city’s outer areas including the Blue Mountains and Central Coast, areas Domain said had been recording their highest rents on record.

Melbourne’s house rents remained steady over the quarter, at $440 per week, while units recorded the largest fall in asking rents since pre-COVID, down 9.8 per cent.

House and unit rentals were jumped in Brisbane (up 2.4 per cent and 1.3 per cent respectively), Canberra (3.4 per cent and 3.1 per cent), house rental prices in Adelaide up 1.2 per cent and unit prices unchanged.