The vacancy rate in Perth rose slightly in July.
REIWA President Joe White said the vacancy rate rose slightly to 0.6 percent in July, reflecting the slow easing of the rental market.
“Perth has experienced a sustained period of extremely low vacancy rates, with the vacancy rate consistently below 1 per cent since August 2022,” he said.
“It fell to a record low of 0.4 percent in March 2024, before reaching 0.5 percent in April, May and June.
“This month’s number is a step in the right direction, but it is still very low and vacancies are still being filled quickly, especially for properties in the cheaper price ranges.”
According to REIWA, a balanced market is one where the vacancy rate is between 2.5 and 3.5 percent. It was last at 2.5 percent in September 2019.
Mr White said the market had been battling unique and difficult conditions for several years, but there were signs of improvement.
“Rental prices are experiencing periods of stability, the rental period for apartments is increasing slightly and the number of rental offers is increasing,” he said.
“The changes are the result of several factors.
“First, demand has changed.
“Demand has regulated itself. We are seeing an increase in the size of renter households and people who prefer to buy rather than rent or who prefer to stay in or return to the family home to avoid the rent conflict.
“The market also appears to have reached an affordability limit. Tenants cannot afford to keep up with rising rental prices. They are either renting with others to share the cost burden or opting to rent smaller, more affordable properties.
“The second change concerned the offer.
“The number of estimated rents has increased as new supply comes onto the market.
“Investor activity has increased over the last 12 to 18 months. In addition to buying existing properties, investors have also purchased house and land packages. These new buildings are being completed and are slowly coming onto the market. This is slowly increasing supply. And there are even more in the pipeline.
“In addition, some tenants have finally completed their new apartments and are moving out of their rental properties, freeing up some of the existing supply.
“We are still a long way from a balanced market, but the numbers are encouraging.”
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