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Tight market forces young into hostels
Simon Santi/The West Australian Tight market forces young into hostels

Young people are becoming long-term tenants in backpacker hostels because they cannot find rental accommodation in Perth.

Peter Doherty, 27, has been looking for a place to rent for two months while staying at the Underground Backpackers in Northbridge.

Mr Doherty feared it would become even more difficult to find a place to live after the latest figures from the Real Estate Institute of WA showed the rental market is the tightest it has been in three years.

He and four friends, who are also staying at the hostel, have enjoyed the backpacker lifestyle but now want to find a place they can call home and put their feet up after a long day's work. "It's fun staying at a backpackers but I'm getting sick of it," Mr Doherty said.

The engineer came here from Ireland on a one-year working visa. He said he knew many other foreigners staying long-term in backpacker hostels because they could not find a place to rent.

Mr Doherty said he believed real estate agents were giving him and his friends the cold shoulder because they were young.

The December quarter figures from REIWA showed the vacancy rate had tightened again to 2.3 per cent, down from 2.8 per cent in the September quarter. A year ago, the rate was 3.4 per cent.

REIWA president David Airey said the low vacancy rate was being driven by future homebuyers waiting to see if house prices dropped further before they entered the market.

"Many people are opting to rent rather than buy because they are waiting for stronger signs that the housing market has bottomed out," he said.

Underground Backpackers manager Jai Thomas said about 30 per cent of their guests were staying long-term because they could not find a place to rent in Perth.

Youth Hostel Association WA operations manager Peter Ott said there was a tendency for guests to become "territorial" if they stayed too long.

"We are in the business of providing accommodation to travellers, not to people who missed out on a tenancy," he said.

Mr Ott said the YHA also wanted to keep the vibe of a backpacker hostel, rather than turn into a long-term boarding house it was not licensed to operate.

Mr Doherty pays about $180 a week to stay in the hostel.