What’s happening in the Broome Rental Market and looking back at 2018.

What’s happening in the Broome Rental Market and looking back at 2018.

What’s happening in the Broome Rental Market and looking back at 2018.

In this past week we have had a flurry of rental properties hit the market that has made our vacancy rate a bit skewed. At the beginning of Dec our vacancy rate was 4.45% but is now nudging slightly above 5%.

The lowest our vacancy rate has been this year was in July just above 1% and was the best it had been for the past 4 years. Interestingly enough the number-of-days on market has not altered and is still hovering around 45 days. This means that potentially landlords need to factor in at least a 3 week vacancy period where they may not have any rental income.

The market is always put under further pressure by “break leases” at this time of the year as some tenants lose employment because of seasonal trends in the tourism and building industries. The number of break leases is not reflected in the vacancy rate but means there is greater selection of what to choose from when the demand is at its lowest point.
The cyclonic weather experienced earlier this year was extremely disruptive to business and we hope not to see a repeat of that again. In comparing the number of rental properties leased thus far in 2018 (300 properties as at today) compared to 31/12/17 where 315 properties was leased, we have managed to almost catch up.

Pleasingly we have been receiving strong enquiry for 2019 from potential renters who are looking to move to the area with new employment.  Enquiry for longer terms of lease has also increased which we have not seen for some time. If you are a landlord we still recommend considering a lease which gets you back into our stronger leasing cycle between March and July. 

What to look forward to in 2019?  Growth in the Kimberley is expected to increase in 2019. The number of new dwellings being built has slowed meaning the available rental stock will decline and if lending standards tighten further this could restrict the number of people able to purchase a property. This will positively impact rental prices as available rental stock declines. This means we should see competition from tenant demand thereby putting upward pressure on the rental amount and downward pressure on the vacancy rate.

As the number of new home approvals declines again significantly so has the competition in the industry as trades increase their prices to cover the shortage of work. We have no doubt demand will outstrip supply as we go forward into 2019.

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