Perth’s drastic decline in rental affordability has been laid bare in a new report which found rental properties listed for less than $400 per week in the city have largely disappeared in the span of just four years.
The latest PropTrack Market Insight Report has revealed the overall share of rental properties listed on realestate.com.au for less than $400 per week in Perth has fallen to only 5.6 per cent, down from 61.5 per cent at the onset on the pandemic in March 2020.
Once boasting one of the most affordable rental markets in the nation, Perth now has the third smallest share of available rental homes in the country for below $400 per week.
Tenants who had more than half (57.7%) of all house rentals available pre-pandemic listed below $400 per week now have about one in 20 homes under that price bracket as rents continue to surge.
Unit rentals have also been impacted, plummeting from two thirds (66.2%) costing less than $400 a week at the start of the pandemic to just 7.4 per cent now.
There’s no reprieve outside the city either, with the share of affordable rentals also declining in regional WA, down from 68 per cent in March 2020 to just 14.8 per cent in April — the smallest share of all regional markets.
PropTrack Senior Economist Paul Ryan said the people he was most concerned about was low income renters.
“They’re the ones who are absolutely doing it the toughest in this current rental crisis and I think this data shows just how tough it has gotten,” he said.
He said it was likely the small ratio of rentals below $400 per week was the new normal for tenants but hopefully government initiatives would stabilise prices.
“It has gotten so bad that there has been a general policy response to build more homes, which really is the big answer here and that has been encouraging but the bad news is, it’s just going to take some time for that solution to work its way through,” Mr Ryan said.
“I think building enough homes so that rents can increase over time but they increase more predictably and more in line with incomes is what we should aim for. And that’s what we had before the pandemic — we had a big period of rental stability, and it is the stability that matters. We clearly haven’t built enough homes over the past two or three years to keep rents stable.”
Tenancy lawyer and Make Renting Fair Alliance spokesperson Alice Pennycott said it was not enough to increase housing supply to address the affordability crisis, particularly when it was not an overnight solution in itself.
“Realistically, it’s also around actually having fair and transparent tenancy legislation. Rent stabilisation is necessary and we’re really disappointed that it hasn’t happened yet,” she said.
“Renters need protection — there are rent control mechanisms that are in place all over the world and there are options that would work really well here, like capping it at CPI or requiring the landlord to justify the increases more than CPI or linking it with wages or wage increases or things like that. We want to have that conversation about how we can make it more fair and more stable.”