With the number of rentals available continuing to rise this month in Perth, the Real Estate Institute of Western Australia (REIWA) believes it's putting pressure on property managers, who are becoming very stressed with the demands from owners.
David Airey, president of REIWA, revealed there’s a massive oversupply in the Perth rental market, with over 5,500 rentals available and the vacancy rate at the four per cent mark.
"There's a huge number of apartments and units being built in Perth," Mr Airey told Residential Property Manager.
“We are reaching the stage where they're overbuilding with these huge numbers of developments going up, which statistically the take-up for them is significantly less than the amount of supply. In other words, they are building so many they are not easily going to be sold, let alone rented,” he added.
He said this means investors will not be attracted to buy a new apartment in the inner city, where the highest vacancy factors are.
Mr Airey believes this is putting a strain on property managers in the city.
"Owners' expectations of rentals haven’t fallen with the market,” he said. “You have got owners saying, ‘Hang on, why can’t I rent my property?' And the property managers say, 'Well you need to drop the rent’, and then the rent drops and the property still doesn’t lease,” he said.
"Vacancy factors are high, the average time taken to rent a property in Perth is out at around 40 days, so that can be a six-week vacancy wait and that is just the average."