PropTrack data shows Perth’s rental vacancy increased by 0.05 percentage points in March, however REIWA figures show the rate as unchanged.
Perth’s rental vacancy rates have jumped by 0.05 percentage points in March to 0.91 per cent, but remain the lowest in the country, according to new data from PropTrack.
The REA Group data provider reported that Perth’s rental vacancy rate is 0.52 percentage points below the capital city average nationally of 1.43 per cent in March.
The group recorded rental vacancy for regional Western Australia at 1.51 per cent in March, tightening by 0.11 per cent in the month.
Annually, Perth’s rental vacancy figures have dropped by 0.29 percentage points, and by 67 per cent since March 2020, highlighting the impact of COVID on the rental market.
Nationally, Australian capital cities’ rental vacancy rates have dipped by 55 per cent during the past three years.
The considerable drop in rental vacancy rates has highlighted the nation’s housing shortage and led to increases in rent prices during the past three years.
According to industry experts, a normalised market occurs at about a 2.5 to 3 per cent rental vacancy rate.
Real Estate Institute of Western Australia data shows Perth’s rental vacancy rate remained at 0.7 per cent in March, unchanged from February and January.
Data from the organisation showed a 17 per cent increase in Perth’s monthly median rent since April 2022.
During the same period, Australian Bureau of Statistics data showed a 44 per cent increase in the state’s average mortgage repayments.
REIWA chief executive Cath Hart said tenants were facing a similar situation to homeowners, in that many are facing their first increases since interest rates started to rise nearly a year ago.
“There has been a lot of talk about the ‘mortgage cliff’ and the financial shock about 800,000 Australians will feel as their fixed rate loans return to variable this year following 10 interest rate rises, but there are also thousands of tenants on fixed-term leases facing a similar issue,” she said.
“Tenants who may have signed 12-month agreements in April, May or June last year for example are likely to see their rent payments increase, perhaps significantly, when their lease expires in the next few months as owners pass through some of the significant increases in their mortgage repayments for their investment property.”
Ms Hart added that REIWA was pleased to hear about investment property owners not padding on the full increases, where their personal circumstances allowed, and making more moderate rent increases in order to retain good tenants.
“REIWA property managers often counsel property owners on the importance of retaining good tenants, noting that if you increase the rent sharply now, tenants may seek to end the lease when rents start to fall, as they eventually will,” she said.
PropTrack told Business News its rental vacancy rates are calculated using the number of properties available for rent on realestate.com.au, as a share of the total number of rental properties.
