RENTAL CRISIS

This rental crisis we are currently experiencing coupled with the soaring house prices even though we have much higher interest rates is making us one of the least affordable countries in the world.

Despite the Federal Government announcing a target of 1.2 million new homes over five years from 2024 (hello we have never built this many homes over a five-year period).  Not sure how they will achieve this wild promise and deliver the goods as back in 2015 to 2020 they built 1.05 million homes.

During that time we saw the biggest influx of Chinese capital ever recorded and there were thousands of apartments built across our CBD's and close to the universities.

So where the money come to develop so many homes as it needs to come from other sources:

Offshore investment

Company owned rentals (build to rent)

Superannuation

Mum & Dad Investors

From what we have seen over the past year investors have pulled away and are selling their investment properties due to the fact that they are slowly losing control over their properties due to the changes in the Tenancy laws (why would you put your neck out?) You need to incentivize them not penalize these investors.

Of course, the next hurdle will be the high construction costs. The surge in the pricing seems to have moderated as building costs have stabilized however doesn't stop people from second guessing about building as it's just not the cost involved it's the time it is taking and also what if the builder goes bust (happening a lot).  Many builders are now going cost plus as they struggle to keep a grip on the rising costs (not just materials but labor).

All I can say is their goal of 1.2 million homes looks impossible to achieve over the next five years the more they build hopefully it will start to ease the shortage but with the amount of people flowing into our country I have very serious doubts.

Rental rates are increasing at a great rate of knots here in WA and now with the one bedrooms fully furnished and equipped going from $310 up to $470 per week, two bedrooms from $380 up to $600 per week the investors from the Eastern States are now starting to snap up those one bedrooms, meanwhile the local is still left scratching his head wondering where it's going to stop.  

Is it going to stop?  Who knows but we cannot see any change in the next 18 months unless the tap turns off with people coming into WA.

Ring us if you need any more information about renting out your property just because there is such a severe shortage of properties makes it even more dangerous on your selection of tenants as you need to be very diligent that they can actually afford what they are offering.

MAKE YOUR OWN DECISIONS AND GIVE IT A REAL GO!!

SELLING MOSMAN PARK & THE WESTERN SUBURBS!!

KEEPING IT REAL IS OUR MOTTO!!