Monthly Archives: February 2018

Clear signs of recovery, stability in Perth rental market: REIWA

Perth’s median rent has been stable for nine months, leasing activity held up well over the holiday season, and listing numbers, vacancy rates, and days on market are down.

After three challenging years of tough market conditions, new REIWA data shows the Perth rental market has stabilised.

REIWA president Hayden Groves said the institute’s data for the December 2017 quarter indicates the Perth’s rental market bottomed out in 2017.

“After a prolonged period of falling rents, soaring listings, and record high vacancy rates, the market has strengthened,” he said.

“The December 2017 quarter results signal a stable market, which is welcome news for landlords and property investors,” said Groves.

MEDIAN RENTS

Perth’s overall median rent price remained at $350 per week during the December 2017 quarter, the third consecutive quarter at that rate.

“Where rents were once declining every quarter, we’ve now observed nine months of steady prices,” Groves said.

Over the year, weekly median rent declined only $10.

This is a “significant improvement” on the previous year, when Perth’s weekly median rent declined $40 between the December 2016 quarter and the December 2015 quarter.

“Annually, the rate of decline has slowed considerably which is pleasing,”Groves said.

The reiwa.com data shows a number of suburbs saw increases in weekly rent over the December quarter.

The top five suburbs for median rent growth in the December 2017 quarter were:

  • Mindarie ($565 per week),
  • Attadale ($455 per week),
  • Bicton ($370 per week),
  • Shelley ($430 per week), and
  • Shoalwater ($295 per week)

LEASING ACTIVITY

There were 13,555 rental properties leased in the December 2017 quarter.

“Despite the traditional lull of the festive season, leasing activity only declined 1.6 per cent during the December 2017 quarter.

“It’s good to see that leasing activity held up well throughout the holiday season,” Groves said.

The suburbs with the biggest improvement in leasing activity volumes during the December 2017 quarter were:

  • Madeley,
  • Kingsley,
  • Inglewood,
  • Piara Waters, and
  • Cooloongup.

RENTAL LISTINGS

There were 8,912 properties for rent in Perth at the end of the December 2017 quarter.

Groves said Perth rental listings have declined substantially since their peak of 11,300 in 2016.

“Listings have declined 8.4 per cent on a quarterly basis and are down 13.9 per cent compared to the December 2016 quarter,” he said.

Construction of new dwellings has slowed, and existing stock is being “soaked up” by the market, said Groves.

In addition, population growth in Western Australia rose to 0.84 per cent in the year to June 2017.

“New entrants into the state soak up rental stock first,” Groves said.

AVERAGE LEASING DAYS

It took 49 days on average to find a tenant in the December quarter, five fewer days than it took in the previous quarter.

Average leasing days were also down three days compared with same quarter for the previous year.

“Healthy leasing activity and declining listings has increased demand, which means tenants are needing to act faster to secure a rental,” said Groves.

“It also shows landlords are listening to the advice of their property managers and pricing their properties competitively from the start,” he added.

VACANCY RATE AT LOWEST IN MORE THAN TWO YEARS

Perth’s December 2017 quarter vacancy rate was 5.5 per cent, its lowest level since the September 2015 quarter.

The December rate compares with 6.9 per cent in the September 2017 quarter, and 6.4 per cent in the December 2016 quarter.

“Perth’s rental market has improved across the board in recent times which has had a very positive effect on the vacancy rate,” concluded Groves.

THE ECONOMY FEB 21, 2018

Strata Titles Act Reform

Landgate is now well advanced delivering major reforms to strata legislation. Landgate is delivering the strata reforms because there have been no major reforms to strata legislation in 21 years. Landgate intents to introduce to Parliament in mid 2018 reforms to the Strata Titles Act.

The strata reforms will improve the way things are done in strata by making strata better for owners and residents and introducing new land development options to drive economic growth. Strata reform will deliver major benefits for owners and residents in strata. Strata managers will be regulated and made accountable.

Community title, leasehold strata and improved strata schemes will enable integrated land development along the transport corridors of Metronet and above train stations. Affordable housing can be provided with leasehold strata.

The key elements of the strata reforms are two new types of strata: Community title and Leasehold strata:
• More flexible staged development
• Improved management of schemes
• Simplified dispute resolution
• Better information for strata buyers and
• Safeguards for the termination of schemes.

Community title is a new type of strata which has multiple sub-schemes within an umbrella community scheme. Each sub-scheme has its own strata company.

Leasehold strata is a strata scheme set up for a fixed period of 20 to 99 years. The buyer acquires a long term lease of the lot, the strata lease. The owner of the strata lease is issued with a certificate of title.

The owner of the strata lease can transfer the lot and the strata lease and can also mortgage the lot all without needing the consent of the lessor. Leasehold strata is used in other parts of the World for development of train stations and to provide affordable housing.

The reforms will make staged development of strata schemes more flexible. It’s difficult to vary a staged scheme development now under the Act. The reforms will allow more flexibility in how staged schemes are developed. This will cut red tape and allow faster development of staged schemes.

Strata reform will improve the management of schemes by:
• allowing electronic notices, voting and record keeping
• by strengthening by-law enforcement
• empowering strata companies to improve common property and
• making it easier to install sustainable infrastructure such as solar panels

The strata reforms will simplify strata dispute resolution. Currently strata disputes are heard in 4 different forums which include 3 Courts and 1 Tribunal. Research has proven that the State Administrative Tribunal or SAT is very effective in resolving strata disputes.

SAT will become the one-stop shop for strata disputes. The reforms will strengthen SAT’s powers to resolve strata disputes quickly and cheaply.

Reforms to termination will introduce safeguards for owners require a transparent process be properly followed the vote is only one part of that process even if the required vote is reached the termination proposal must undergo a fairness and procedure review by SAT. Vulnerable owners will have access to funding to respond to the termination proposal. Buyers of strata will receive better information. The strata information summary will be easier to read and electronic disclosure will be allowed.

Strata is very important to the WA economy. WA has over 300,000 strata lots which are worth over $170 billion. Strata is becoming more popular 40 to 50 percent of all new land subdivisions in WA are strata.Strata is more than just apartment housing, it is also used for commercial, retail and industrial premises.

Landgate are proposing to provide time forthcoming for community consultation prior to reintroduction of the Bill to Parliament.

Article statistics sourced from Landgate, Western Australia, January 2018