Perth is shaping as one of the nation’s strongest rental markets in 2012, according to the latest research from RP Data.
The strength of the rental market is being driven by the WA capital’s low rental vacancy rates, which dropped by 0.6% between the months of September and December 2011, according to RP Data.
“Perth is back on the radar again with investors,” said Angus Raine, CEO, Raine & Horne. “The low vacancy rates coupled witha shortage of new housing and spin-offs from the booming mining sector are steadily creating more ideal conditions for investors in Perth.”
Larry Gallagher, Principal of Raine & Horne North Perth concurs. “They don’t ring a bell when the market turns but low vacancy rates are a positive indication that the market is coming around again.”
In addition to the low vacancy rates, the report from RP Data showed an increase in weekly rents of 10.3% for houses and 7.6% fo runits over the past 12 months.
Furthermore, the National Housing Supply Council’s 2011 State of Supply Report indicated that despite the higher returns on houses in Perth, the demand is stronger for units than for free standing homes. “We are certainly hearing from investors who are looking at both categories of properties,”confirmed Mr Gallagher.
Yet, despite the positive findings by RP Data,some investors and industry pundits will have one eye on the review of the proposed changes to the Western Australia residential tenancy laws.The Residential Tenancies Amendment Act was passed by WA state parliament in November 2011 as a result of extensive research and consultation with landlords, tenants, real estate agents, peak associations and relevant Government agencies.
The review is assessing a number of issues including the content and form of the prescribed residential tenancy agreement; the minimum content for mandatory property condition reports; the amount of the capped ‘option fee’; a clarification of the minimum security obligations for residential rental premises; and an explanation of which ‘urgent repairs’ should be considered ‘essential services’.
Property managers, landlords/investors and tenants have the opportunity to comment on the changes via the Western Australia Department of Commerce. The closing date for submissions is 17th May 2012.
The WA Consumer Protection department believes the changes will create a fairer and more efficient rental marketplace. “There is always room for improvement with the tenancy laws,” said Tim Chant, Principal of Raine & Horne Cannington. “However it’s important to note that every case is different and often the rights of the tenant trump those of the landlord. Landlords need more protection when it comes to legal disputes, so I’d like to see this issue taken into consideration by the WA government.”