Rents haven't dropped for 20 years... until now

Would you believe your local real estate agent when they say that the Perth market has bottomed out? Or would you believe the statistics that just came out which indicate rent prices dropping for the first time in 20 years in Australia? CoreLogic RP Data has revealed that Perth dropped in rent price over the last 12 months by a massive 8.4%. Darwin has dropped 11.5%.

It comes a day after an article mentioned that Perth is undergoing a building boom with thousands of inner city and inner suburb apartments going up whilst the population has gone backwards due to the mining downturn. For the year ending June 2013, 77,000 more people came to WA but for the year ending June 2015 population growth had reduced to 33,000 people.

"The most concerning part of the population trend is that it has now been five consecutive quarters where interstate migration has declined. Before this current trend commenced in June 2014, it had been eleven years since a negative interstate migration figure had been produced in WA.

On the housing supply side of the equation, the city normally builds around 18,000 dwellings per year.  Over the last two years, 53,000 dwellings have been approved in Perth. The over-supply pipeline will hang around for at least of couple of years yet.

In July 2013, there were 7,800 properties for sale; today there are 15,200. It’s a similar story with sales volumes – in July 2013, approximately 900 properties were being sold per week and now it’s back to 500 per week." - Why Perth Property Prices will be lower again by year end