New data released by the Australian Bureau of Statistics places Western Australia (WA) second only to NSW in terms of median weekly rent. The state has also had a bigger jump in rental prices of any state in the country.
While Victoria, Queensland, South Australia, Tasmania, the Northern Territory and the ACT enjoy median rent prices below the $500 a week mark, the average rent in WA is now $613 – only narrowly cheaper than NSW’s $650 a week.
Shelter WA chair Kieran Wong said the rental market in WA was now a poverty trap and a driver of homelessness. “As chair of Shelter WA since 2019, I’ve seen the rental crisis worsen each year and impact people that should be unthinkable in a prosperous state. The rental market used to be a stepping stone into independence or home ownership – it’s now a poverty trap or worse,” he said.
During April this year, rents in Perth increased by $16 per week to $616 per week after being stagnant for the previous five months at $600 per week.
During the same month, figures show there were only 287 building approvals for apartments in WA, which was less than the figure ten years ago. In April 2015, 672 apartments were approved.
Apartments are a critical part of our housing stock, as around 28 per cent of renters live alone. This huge demand for rental accommodation compared to supply has seen the median weekly rent in some inner-city suburbs such as East Perth surge by 17.5 per cent over the past year.
In comparison, in the outer-city suburbs such as Baldivis, where much of the housing construction boom is occurring, weekly rents have increased by just 3.2 per cent over the past 12 months.
Further pressure will be placed on the market next year when the ECU college campus in Northbridge opens, with more than 10,000 students and staff needing accommodation.
A major priority should be independent review of nuisance red-tape regulations both at state and local government, which are slowing down new developments. “We need to stop this growing tyranny of death by hundreds of red-tape cuts so we can urgently remove unnecessary financial costs and delays to the approvals process,” say experts.
They also believe GST on the construction of new apartments should be removed and banking regulators should remove rules that make banks more reluctant to help fund higher-density housing projects, especially for small developers. “The banks should be forced to offer more flexible lending packages to smaller developers and not the current one-size-fits-all approach. This could include special loans for small to medium-sized developers that wish to keep the building for build-to-rent purposes.
Citizens also need a package of enhanced financial incentives to help kick-start these inner-city developments, such as cutting stamp duty and reducing land tax rates for shovel-ready inner-city housing developments, experts recommend.
