Perth's residential vacancy rate has plummeted to 0.96%, the lowest level in 13 years.
It's only the third time in 40 years the vacancy rate has dropped below 1%, with rents set to spike as a result.
Real Estate Institute of Western Australia (REIWA) President Damian Collins said the rate could drop below the lowest ever recorded rate of 0.8% in March 2007.
“With rental listings in Perth falling 8% to 2,926 over the month, we have certainly hit a rental crisis where tenants looking for a rental will potentially find themselves unable to find a home,” Mr Collins said.
“In addition, the reduced supply is putting upward pressure on rents with property managers on the ground finding increases in rent are occurring on new leases, as prospective tenants are in competition with each other to secure the limited supply.”
Buying a home or looking to refinance? The table below features home loans with some of the lowest variable interest rates on the market for owner occupiers.
Perth typically sees an influx of investors in the Spring selling season which increases housing stock, but this hasn't been the case so far this year.
Mr Collins said if investors weren't encouraged back into the market the situation would only worsen.
“Western Australia has approximately 17% of properties purchased by investors, whereas we would normally expect to see investors buying 30% or more of the available properties," he said.
"At the same time, we still have investors exiting the market, meaning the supply of rental properties is not sufficient to keep up with demand."
The Western Australian (WA) government recently announced an extension to the moratorium on evictions and rent increases until March 28 2021.
Mr Collins said the government needed to ensure these provisions were not extended further so investors could feel confident in returning to the market.
"The government needs to send a clear signal to the market that they have no intention of extending the legislation further if we remain relatively COVID-19 free," he said.
"Otherwise investors will continue to sit on their hands and make a bad situation even worse.”
At the time of the extension announcement, WA Commerce Minister John Quigley said the extended moratorium was vital for the state's economic recovery.
"Western Australia is entering a period of economic recovery, however with the threat of COVID-19 and a second wave still real, extending the rent moratorium protects WA renters and landlords, and helps create stability for everyone," Mr Quigley said.
"For residential tenancies, low vacancy rates for rental properties have, and will continue to force rents to rise, and this together with the current unemployment rate, as well as changes to JobKeeper, means families may find themselves in financial hardship.
"To add difficulties in finding rental accommodation or not being able to afford rent to their worries would be an awful proposition."
WA joined every other state, except Queensland, in extending the moratorium on evictions.
The entire market was not considered in selecting the above products. Rather, a cut-down portion of the market has been considered which includes retail products from at least the big four banks, the top 10 customer-owned institutions and Australia’s larger non-banks:
- The big four banks are: ANZ, CBA, NAB and Westpac
- The top 10 customer-owned Institutions are the ten largest mutual banks, credit unions and building societies in Australia, ranked by assets under management in November 2020. They are (in descending order): Great Southern Bank, Newcastle Permanent, Heritage Bank, Peoples’ Choice Credit Union, Teachers Mutual Bank, Greater Bank, IMB Bank, Beyond Bank, Bank Australia and P&N Bank.
- The larger non-bank lenders are those who (in 2020) has more than $9 billion in Australian funded loans and advances. These groups are: Resimac, Pepper, Liberty and Firstmac.
- If you click on a product link and you are referred to a Product or Service Provider’s web page, it is highly likely that a commercial relationship exists between that Product or Service Provider and Savings.com.au
Some providers' products may not be available in all states. To be considered, the product and rate must be clearly published on the product provider's web site.
In the interests of full disclosure, Savings.com.au, Performance Drive and Loans.com.au are part of the Firstmac Group. To read about how Savings.com.au manages potential conflicts of interest, along with how we get paid, please click through onto the web site links.
*Comparison rate is based on a loan of $150,000 over a term of 25 years. Please note the comparison rate only applies to the examples given. Different loan amounts and terms will result in different comparison rates. Costs such as redraw fees and costs savings, such as fee waivers, are not included in the comparison rate but may inﬂuence the cost of the loan.
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