By Sarah Brookes
Perth’s rental crisis has worsened as unit and house rents reach fresh highs off the back of a record-low vacancy rate, prompting the WA Liberals to call for immediate action from the state government to address the crisis.
The median asking rent for houses jumped 18 per cent to $650 a week in the year to March – the biggest increase across the capitals – the latest Domain Rent Report, released on Thursday, shows.
The report shows house rents are at record highs across the combined capitals and all cities, apart from Canberra.
House rents across the combined capitals have surged by 5 per cent in the March quarter, marking the steepest quarterly gain in 17 years and the second-highest on record.
Unit rents are also at an all-time high across all capital cities apart from Hobart, with the combined capitals seeing an unprecedented stretch of 11 successive quarters of growth.
Quarterly gains in unit rents also surpassed houses across all capital cities apart from Adelaide, with gains of 22 per cent in Perth to reach a record median of $550 per week.
Vacancy rates have decreased in the last quarter across all capital cities except Hobart.
Sydney, Melbourne, and Perth are at record lows while Adelaide and Brisbane are nearing record lows.
WA opposition housing spokesman Steve Martin said the news was evidence the state Labor government had let housing supply deteriorate to record levels.
“The 0.4 [vacancy rate] is a significant drop from the already low rate of 0.7 per cent and lower even than the previous 42-year record in December 2022,” he said.
“[Labor has] had seven years in government and this problem is only getting worse. A record low rate of 0.4 per cent – it’s starting to get perilously close to zero.
“Less than 2000 homes available for sale across Perth. The price of those homes will skyrocket, rent will skyrocket as people have no option but to keep paying.
“And what answers do the Cook government have? A handful of social homes bought for $700,000 each in Hamilton Hill.”
An additional 239,000 people are predicted to come to WA between 2024 and 2027.
Domain’s chief of research and economics, Nicola Powell, said while Australia’s perilous rental market appeared entrenched in a never-ending run of rent rises, she was optimistic a tipping point would be reached in 2024.
“The first quarter of the year usually marks the rental change-over period, and we anticipated it would be one of the most challenging seasons yet due to the already low rental stocks,” she said.
“The current rental conditions show this intensified seasonal trend – a surge in tenant demand against a limited supply.
“This imbalance has consequently fuelled a renewed acceleration in rental price growth.”
Powell said the number of prospective tenants per rental listing was easing, suggesting some pressure has lifted.
“This could be an early indicator of an increase in vacancy rates sometime this year,” she said.
“Also, international student visa applications have turned a corner and started to fall for the first time in more than two years, population growth is likely to have peaked, and the federal government has introduced a migration strategy that will slow population growth.
“Homeownership is also at the forefront with incentives in place which will help transition some to being owners or fast-track others to a more affordable purchase.”
West Australian pet owners continue to feel the bite of the housing crisis, with a more than 40 per cent jump in surrender requests.
Around 350 pet owners asked to surrender their pets to RSPCA WA in the first three months of the year, compared to 240 at the same time last year – a 44 per cent jump.
More than one-third of all requests over the past 18 months were because pet owners could no longer afford to feed or care for their animals, couldn’t find a pet-friendly rental, or had become homeless.
RSPCA executive manager animal and enforcement operations Hannah Dreaver said seeing the cost-of-living and housing crises contribute so much to surrender requests was disheartening, but not surprising.
“Recent victims are Flossy*, a Jack Russell terrier, and her owner Gordon*,” she said.
Jack Russell terrier Flossy* had to be surrendered to the RSPCA due to Perth’s diabolically low rental vacancy rate.Credit: RSPCA
“Flossy came into our care three weeks ago because Gordon had become homeless and couldn’t access an emergency shelter with a dog.
“As an older man, he had the choice between sleeping rough with 12-year-old Flossy and feeling unsafe for both of them, or having the chance at a bed for the night.”
REIWA President Joe White said there were some signs the market may be easing.
“Some of our members are reporting there has been a slowdown in demand for the higher end of the market,” he said.
“Homes priced under $1000 took a median of 15 days to lease and in some suburbs with a median dwelling rent below the current Perth median, homes leased in 10 – 11 days over the quarter.
“Demand remains strong in the more affordable price brackets. While in the mid-range, members are reporting numbers at home opens are declining in some suburbs, however they are still receiving multiple applications.”
*Names changed to protect privacy.