The long-term tightness in the Perth rental market has been slowly moderating, with median rents unchanged since March.
According to REIWA’s latest data, the median weekly dwelling and house rents held steady at $650 in June, while the median weekly unit rent was also stable at $600.
REIWA CEO Cath Hart said there were clear signs the rental market was slowly changing.
“Rents have been stable for a number of months, properties are taking longer to lease and the number of listings continues to rise,” she said.
“While the change isn’t reflected in all the data, for example, the vacancy rate remains at a near-record low, our members at the coalface are reporting that conditions are slightly less frenzied than they were previously.
“That said, we aren’t out of the woods yet as WA is still recording strong population growth and new housing completions remain low.
“Today’s numbers are, however, encouraging and on the pathway to a more balanced rental market.”
Ms Hart said the change was due to several factors.
“We’re seeing some ‘self-moderation’ of demand for rental homes as tenant household sizes increase and as people avoid renting where possible,” she said.
“We are also finally seeing an increase in new supply in some areas, and we hope to see this trend continue.”
Despite the continued stability in June, rents remained significantly higher than a year ago.
The median weekly dwelling rent rose 18.2 per cent year-on-year. The median house rent rose 12.1 per cent and the median unit rent rose 14.3 per cent.
“REIWA’s March quarterly update forecast the rate of rent price growth would slow over 2024 and we are starting to see that now, particularly for houses,” Ms Hart said.
According to www.reiwa.com, the suburbs that saw the most growth in their median weekly dwelling rent price in June were Beckenham (up 8.3 per cent to $650), Bayswater (up 5.8 per cent to $635), Maddington (up 5.5 per cent to $580), Fremantle (up 4.5 per cent to $700) and Nollamara (up 4.2 per cent to $625).
Listings for rent
There were 2,484 properties available for rent on www.reiwa.com at the end of June. This was 3 per cent higher than May and 16.8 per cent higher than the same time last year.
“The number of rental listings has been slowly increasing since February,” Ms Hart said.
“The last time they were at similar levels was April 2022.”
Median leasing times
Homes leased in a median of 18 days during June, two days slower than May and a year ago.
“This is another indicator of change in the market,” Ms Hart said.
“Earlier this year it took 15 days to lease a home, the slowdown reflects the moderation in demand and suggests slightly less competition for properties.
“However, we are still a long way from the 33 days it took to lease a home five years ago, when the vacancy rate was 2.9 per cent.”
www.reiwa.com data showed the suburbs recording the fastest median leasing times in June were Hamilton Hill (eight days); Eglinton and Nollamara (11 days); Bayswater and Tuart Hill (12 days); Joondanna and Wellard (13 days); and Maddington, North Perth and Balga (14 days).
Perth sales market
Property prices rose again in June.
Houses reached a new record median sale price of $660,000, up 1.5 per cent on the $650,000 reported in May and 17.9 per cent higher than June 2023.
The median unit sale price also rose over the month, increasing 1.3 per cent to $440,500. This was 10.1 per cent higher year-on-year.
“While house prices have been setting new records for some time, units remain below the previous record of $450,000 set in 2014,” Ms Hart said.
“Based on current growth rates they could exceed that in the next few months.
“This is welcome news for people who bought a unit over a decade ago and have been waiting for capital growth.
“It is also a positive sign for new apartment development. The discrepancy between unit prices and increased building costs has meant only higher-end apartment projects have been financially feasible for developers. This has limited the provision of diverse and affordable housing options for home buyers and investors.
“Growth in the median unit sale price may help stimulate new, more affordable projects.”
The suburbs that saw the most growth in June were Queens Park (up 3.4 per cent to $553,000), Bullsbrook (up 2.8 per cent to $575,500), Langford (up 2.4 per cent to $512,000), The Vines (up 2.3 per cent to $875,000) and Wannanup (up 2.2 per cent to $690,000).
Bertram, Piara Waters, Caversham, Seville Grove and Leeming were also among the top performers, recording growth of 1.8 per cent or more over the month.
Time on market
Houses sold in a median of eight days in June, unchanged from May but three days faster than a year ago.
Units sold in a median of 11 days, one day slower than May but nine days faster than a year ago.
According to www.reiwa.com data, the fastest selling suburbs in June were Camillo and Thornlie (four days); and Mandurah, Ballajura, Eglinton, Huntingdale, Leeming, Queens Park, Wanneroo and Wellard (five days).
“While there has been a softening in the rental market, when it comes to sales, homes continue to fly off the shelves,” Ms Hart said.
“At the moment, there are no signs this will change soon, which makes it very challenging for buyers.
“With competition so high, we recommend potential buyers get their finance approved before they hit the market to put them in a strong position when they make an offer.
“Current conditions also mean they will need to be patient and persistent. They will eventually find a home but are very likely to receive several knockbacks along the way.
“When this happens, it can be worthwhile speaking to the agent about the offer the sellers chose. While price is often a factor, they may have also looked favourably on an offer that will allow for a longer settlement or a rent back period, or a cash offer. This may help with future offers.”
Listings for sale
Active listings* for sale settled at 3,265 at the end of June, this was marginally lower than May and 38.9 per cent lower than a year ago.
“There is a perception there are no homes for sale, but when we look at the data we have seen more properties come to market in the first six months of 2024 than the same period last year,” Ms Hart said.
“However, they are selling almost as soon as they become available.
“While this continues, we can expect active listings to remain very low.”
* Active listings – the number of properties advertised on www.reiwa.com at any given time. New listings – new properties listed for sale.
