14/09/2020 - 17:31

Perth rental squeeze continues

14/09/2020 - 17:31

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Rental vacancies across Perth’s housing market continue to tighten, with vacancy rates dropping for another month to 1.3 per cent.

Perth rental squeeze continues
Perth’s residential rental market vacancy rate dropped to a 12-year low in July 2020. Photo: Gabriel Oliveira

Rental vacancies across Perth’s housing market continue to tighten, with vacancy rates dropping for another month to 1.3 per cent.

The Real Estate Institute of Western Australia president Damian Collins said in just two months, Perth’s vacancy rate had fallen from two per cent to 1.3 per cent, a trend that was expected to continue over the coming months.  

“The McGowan government’s short-sighted decision to extend the emergency period for all tenancies is making a difficult problem even worse,” Mr Collins said. 

“Unfortunately, sitting tenants are unlikely to move or adjust household size as they are paying below market rents.

“In addition, we are seeing an influx of people trying to find a new rental property in a market with a very low vacancy rate.”

Last week, the government announced it would extend COVID-19 emergency laws preventing residential and commercial tenants from eviction, despite opposition from industry groups.

As part of the extension, the state government said it would introduce a new hotline for landlords that will offer specialist assistance for coronavirus-related tenancy issues.

Evictions would still be allowed under limited circumstances, including where a tenant is seriously damaging the property or causing injury to neighbours.

Mr Collins said instead of a blanket extension, criteria should have been added to the legislation so that only those impacted financially by COVID-19 received the support that they need.  

“Right now, investors are sitting on the sidelines partially due to the COVID-19 residential tenancy laws and by extending the legislation on all properties, it means investors are likely to continue to stay out of the market, which will further reduce supply at the worst possible time,” Mr Collins said. 

“It’s not too late for the McGowan government to change their position, as we need to get investment confidence back, so investors bring the badly needed supply of rental properties back into the market. 

“Without any change in the policy, it’s feared that a rental shortage will quickly turn into a rental crisis.” 

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