Perth's rental market for houses and units has experienced the strongest growth of any capital city over the past year, according to data from Australian Property Monitors.
Rents for houses in Perth rose 6 per cent in the June quarter, to a median asking rate of $350 per week, bringing the annual increase to 17 per cent.
This was the highest growth rate of any city and equal to Melbourne's increase.
In Perth's unit market, rents were up even higher, by 9 per cent to $350 per week.
This was an increase of 25 per cent since June last year.
Below is comment from APM general manager Michael McNamara:
"It is obvious rising rents are being driven by high mortgage rates. On one hand landlords are trying to offset increased costs and on the other hand high interest rates deter renters from making the shift into home ownership.
The combination of Generation Y leaving home, strong migration patterns and a weak building sector is intensifying demand. The shortage of affordable accommodation will no doubt add to the growing number of displaced renters who cannot afford to live in well located areas.
This latest rental report provides clear evidence that disaffected would-be home owners are driving up rental values in the most unaffordable capitals.
Unsurprisingly, those capitals worst affected by deteriorating housing affordability are also the capitals where tenants are experiencing rapidly rising rent. Perth and Sydney are the most expensive capitals for home buyers and they are also the capitals where tenants are under the most pressure from rising rents.
Sydney asking rents for houses and units have soared by 15% and 11% over the last 12 months. Perth, our second most unaffordable capital, is even worse for tenants. House and unit rental values have increased there by 17% and 25% respectively.
This is brought into stark relief when compared to affordable capitals such as Hobart and Adelaide. First home buyers still have realistic and affordable options there and as a result, rental growth has been much more subdued."
