The plummeting Perth rental property vacancy rate is now down to 2.5%. That’s 15% lower than it was just a year ago and well below the 7.5% vacancy rate of 2017.
The rental vacancy rate is currently the lowest since 2013 and as we previously forecasted, once the vacancy rate fell below 3%, the rental levels would start to rise.
As we predicted, according to the WA Real Estate Institute, 29% of the Perth suburbs have recently seen rental increases.
As a consequence the median in the tightening rental market across Perth has risen to $360 a week.
When you combine this trend along with the fact that pending mining company projects in the Goldfields and Pilbara amount to a spend-up of $75 billion, there is little doubt that as the demand for workers develops, we’re going to see the surfacing of an extremely tight property rental market yet again.
And with that prospect in mind, it would seem to us that with property prices in some localities only just above where they have bottomed over the last 4-5 years, the current market is presenting some outstanding opportunities for investors to get in at the right price.
If you think about it:
- At a vacancy rate of 2.5% there should be no problem in finding tenants
- As it tightens further you can confidently expect further rental level increases to occur
The next question: What about long term capital growth?
The Real Estate Institute recently reported that 10 suburbs completely defied the real estate downturn that most of Perth has gone through.
These were up market suburbs - nine with median prices of over $800,000 and seven in the range of $1million.
It seems likely that the localities in the close hinterland of these will soon see price rises (some are already) and as the momentum of the resources industry construction takes place, property prices all over Perth will rise.
Hence we regard the current time as representing a very good opportunity for investors to get in before the lower end of the market starts to move.
A key point to note:
Over the last 4-5 years while the rental market has seen incredibly high vacancy rates Peak Central has refined its property management system to consistently have its vacancy rates well below the average of other real estate agencies.
Just in the first three weeks of May our team handled 21 new property leases.
We have not just refined our system to have better management systems but we have also made a practice of identifying properties that we consider to have strong rental and capital growth prospects.
As a consequence we are in a very good position to be able to assist prospective investors to find properties with potential.
If property investing is something of interest to you – or maybe you’re interested in adding to a current investment portfolio, call us on 9414 9055.
We would be glad to show you the way.