Reduced investor activity in the Perth market has put pressure on rents and prices are not expected to drop in the second half of the year, says Harcourts WA chief executive Andrew Moore.
The global financial crisis and credit crunch had discouraged many investors from entering the market and incentives needed to be established to entice them back, Mr Moore said.
“Currently, the Residential Tenancies Act favours the support and protection of tenants to a greater degree than it does owners,” he said. “For example, owners are required to give far more notice than the tenants of their intention to terminate a lease agreement. This imbalance has long been a disincentive to property investors.”
While in favour of providing sufficient protection for renters, the same environment should be granted to owners, to increase the number of available rental properties and control upward pressure on rents, he said.
However, investment activity has increased in the Mandurah area, with average weekly rents rising in some areas as the population and demand increases, according to Raine & Horne Mandurah principal Peter Vetten.
The gross rental yield for Perth houses is at 4.7 per cent and units at 5.2 per cent. The median weekly rent for Perth houses is $370 and $350 for units, with a vacancy rate of 2.9 per cent for the March quarter, according to REIWA figures.