Landlords are being forced to drop rents in the Perth metropolitan area as tenants abandon the city's stretched rental market to buy properties of their own, according to WA's main real estate body.
REIWA president David Airey said after years of big increases, the metropolitan rental market was easing, with the vacancy rate lifting from 1.9 per cent at the end of last year to 3.1 per cent last month.
Mr Airey said the institute's data showed the median rent had dropped $5 to $470 a week but the results were patchy and some suburbs had seen much bigger falls than others.
The biggest decreases were in the City of Perth, where the median rent plunged $30, in South Perth, Victoria Park and the western suburbs, where it fell $25, and Mundaring, where it dropped $23.
Owners needed to accept that market conditions had changed and they needed to adjust their expectations of rental return.
"Typically, people are now paying around $475 for a house, down by $5 on the June quarter, or $450 for a flat, unit, apartment or villa, which is down by $10," Mr Airey said.
Altitude director Paul Tonich said Perth's rental market had gone from "stupid" to a "still extremely healthy" and those who had overpriced properties had had to adjust them to suit."The market has returned to what can be considered to be slightly more normal," Mr Tonich said.