RISING construction costs linked to global oil prices are expected to sustain pressure on Perth’s housing market, with impacts already evident in suburbs including Midland, Kalamunda, Brabham and Woodvale.

The Real Estate Institute of Western Australia (REIWA) said supply disruptions tied to conflict in the Middle East were delaying builds and pushing more buyers and renters toward established homes.

REIWA deputy president Rob Mandanici said higher oil prices were already impacting the sector.

“Rising oil prices are already putting upward pressure on building costs and are also causing delays in the supply of materials,” he said.

Mr Mandanici said delays in construction would keep more people in the rental market longer, increasing demand without a matching lift in supply.

“We are particularly concerned for the rental market and tenants,” he said.

Across Perth, the median dwelling rent rose 1.4 per cent in March to $720 per week, while house rents increased 2.8 per cent to $740 per week.

Rental supply remains constrained, with 1870 properties listed at the end of March, down 11.1 per cent compared to the same time last year.

Homes are leasing quickly, with a median leasing time of 15 days, and as little as five days in suburbs such as Woodvale.

Mr Mandanici said the situation reflected pandemic-era conditions, when reduced rental supply drove sharp increases in prices.

“Our modelling estimates nearly 20,000 rental properties were removed from the market,” he said.

“That saw rent prices soar and vacancy rates plummet across the state.”

On the sales side, Perth’s median house price rose 1.1 per cent in March to $880,000, with continued growth recorded in suburbs including Brabham and Kalamunda.

Unit prices also increased, with Midland among the suburbs recording gains over the month.

Homes continue to sell quickly, with houses taking a median of nine days and units eight days, despite a seasonal rise in listings.

Mr Mandanici said while some buyers may delay decisions due to uncertainty around fuel prices, inflation and interest rates, demand remained strong.

“Problems in the delivery of new homes will maintain the focus on established homes,” he said.

With population growth continuing and building constraints persisting, pressure on both rental and sales markets is expected to remain in the months ahead.