Perth Short-Term Rentals Yield 1.9%, Beating Long-Term

Short-Term Rentals Out-Gross Long-Term in Perth by {{str_premium_pct_fmt}}

Perth's short-term rental gross revenue runs roughly {{str_premium_pct_fmt}} ahead of long-term lease on a typical 3-bedroom house, before any operating costs are subtracted. That premium is sizeable, but it is conditional on hitting the regional average occupancy of {{str_occupancy_pct_fmt}} across {{available_nights}} available nights. Drop below that and the gap closes quickly.

Estimates for a typical 3-bedroom house. Figures are modelled from market data; not guaranteed outcomes.

Both revenue figures match the Dashboard's calculation for this market.

Short-term rental wins on top-line revenue, but operating costs are roughly {{total_costs_str_annual_fmt}} versus {{total_costs_ltr_annual_fmt}} for long-term rental, narrowing the net advantage considerably.

Break-Even Occupancy: {{str_breakeven_occ_pct_fmt}}

Short-term rental only out-grosses long-term lease in Perth if occupancy stays above {{str_breakeven_occ_pct_fmt}}. That is well below the regional average of {{str_occupancy_pct_fmt}}, leaving a comfortable margin in normal conditions. But Perth's tourism mix is more domestic and business-driven than the eastern capitals, and a poor leasing month or two can quickly swing a property below that threshold.

Occupancy Sensitivity: The Single Biggest Variable

Occupancy is the lever that decides whether short-term rental works. Long-term rental income is essentially fixed once a property is tenanted; short-term rental income swings dramatically with occupancy. At a softer {{str_occ_low_pct_fmt}} occupancy, gross revenue falls to roughly {{str_gross_at_low_occ_fmt}}, which is closer to long-term lease territory. At a stronger {{str_occ_high_pct_fmt}} occupancy, gross revenue climbs to around {{str_gross_at_high_occ_fmt}}. The ceiling at 100% occupancy across {{available_nights}} available nights is approximately {{str_max_revenue_fmt}}, but no real property hits that mark.

This makes two things clear. The verdict is conditional on execution, not guaranteed. And modelling your specific property is essential before committing capital.

Perth Yields Sit Below the State Average for Long-Term Rental

The dataset for this article covers a single core Perth catchment. The state average gross yield sits at {{state_avg_yield_fmt}}, roughly in line with the national median of {{national_avg_yield_fmt}}. Sale prices in Perth's central market run close to the state median ({{state_avg_sale_price_fmt}}) and below the national figure ({{national_avg_sale_price_fmt}}), so any yield gap in this area reflects rent growth lagging price growth in the central catchment, not abnormal pricing.

Perth has long been a market where investors accept lower immediate cash flow in exchange for capital growth potential, particularly in mining-cycle upswings and during interstate migration waves. That trade-off only works if appreciation actually delivers; in flat or declining periods, a 3-bedroom house at {{gross_yield_ltr_fmt}} gross yield struggles to cover a fully geared mortgage at current rates.

These are city-level medians. Individual Perth suburbs differ. Coastal pockets, inner-ring gentrifying areas, and outer growth areas all carry different yield, growth, and risk profiles.

View Perth in the dashboard → Free preview · every bedroom count and property type

Operating Costs Trim Perth's Headline Yields Sharply

Headline gross yields rarely survive contact with operating costs, and Perth is no exception. For a long-term rental, total annual operating costs run to approximately {{total_costs_ltr_annual_fmt}}. That total covers landlord insurance of around {{insurance_ltr_annual_fmt}}, ongoing maintenance of around {{maintenance_annual_fmt}}, council rates of approximately {{council_tax_annual_fmt}} (at a rate of {{property_tax_pct_fmt}}), and a property manager taking roughly {{management_fee_ltr_pct_fmt}} of rent. Net long-term rental income comes in around {{net_income_ltr_annual_fmt}} per year, a net yield of {{net_yield_ltr_fmt}}.

Short-term rental costs are higher. Total operating costs run to roughly {{total_costs_str_annual_fmt}}. The Airbnb host fee alone is {{airbnb_host_fee_pct_fmt}} of bookings, working out to approximately {{platform_fees_annual_fmt}} per year (note Stayz typically charges around 5%, and direct bookings carry no platform fee). Landlord and contents insurance for short-term use runs higher, at approximately {{insurance_str_annual_fmt}}. Maintenance is also higher because guest turnover accelerates wear on furnishings, fixtures, and finishes; expect around {{maintenance_str_annual_fmt}} annually, with an upfront furnishing budget of roughly {{furnishing_cost_fmt}} for a 3-bedroom house. Utilities run around {{utilities_annual_fmt}} a year because they are the host's responsibility, not the guest's. Net short-term rental income lands around {{net_income_str_annual_fmt}}, a net yield of {{net_yield_str_fmt}}.

If you choose to hire a professional short-term rental manager rather than self-managing, add approximately {{str_agent_fee_annual_fmt}} to annual costs at a market rate of around {{management_fee_str_pct_fmt}} of revenue. That option changes the maths and is worth modelling separately.

State land tax applies separately for properties above the Western Australia threshold and is reported as its own cost line in the dashboard. The council rates figure above is the council levy only and does not include state land tax, which can add several hundred to several thousand dollars annually depending on land value.

Tax Implications for Perth Investors

Tax treatment is where the long-term-rental case strengthens, particularly for higher-income investors. Australia's marginal tax rates after the 1 July 2024 Stage 3 changes are 0% up to $18,200, 16% from $18,201 to $45,000, 30% from $45,001 to $135,000, 37% from $135,001 to $190,000, and 45% above $190,000. Negative gearing allows rental losses, including non-cash deductions, to be offset against salary income at the investor's marginal rate.

For a Perth long-term rental at {{rent_annual_fmt}} gross rent against {{total_costs_ltr_annual_fmt}} of cash operating costs and a typical interest bill on a fully geared loan, a cash loss is plausible in the early years. On top of that cash loss, the investor can claim the building depreciation allowance (2.5% per year for buildings less than 40 years old) plus fixtures and fittings depreciation. With a depreciable building base of around {{depreciation_base_fmt}} (roughly {{building_ratio_pct}}% of the purchase price), the annual building depreciation deduction is approximately {{depreciation_annual_fmt}}.

The tax saving scales with the investor's bracket. If a Perth investor generates a $20,000 combined cash and depreciation loss on a long-term rental, the tax saved is roughly $9,000 at the 45% bracket (income above $190,000), $7,400 at the 37% bracket ($135,001 to $190,000), and $6,000 at the 30% bracket ($45,001 to $135,000). For a profitable short-term rental, none of this applies, the property is producing taxable income, not a deductible loss. That is why the after-tax comparison can look very different from the pre-tax table at the top of this article: a long-term rental showing a modest pre-tax loss can deliver a positive after-tax outcome, while a short-term rental showing better headline numbers may be paying full marginal tax on profit.

The 50% capital gains tax discount applies equally to both strategies for properties held longer than 12 months. Negative gearing is not free money; it requires a genuine cash loss. But for high-income Perth investors weighing strategies, the tax treatment can tip the balance toward long-term lease even when short-term rental shows higher pre-tax income.

After-tax outcomes depend on individual income and bracket; enter your salary in the dashboard to see how negative gearing and depreciation shift the short-term rental versus long-term rental comparison for your tax position.

Perth Versus the Western Australia and National Picture

Comparison of key investment metrics.

Perth prices sit slightly below the Western Australia state average and well below the national median, while long-term rental yields trail the state. The market reads as one where investors lean on capital growth rather than cash flow, and where short-term rental can be the cleaner cash-flow play for those willing to operate it actively. For a comparison of houses and apartments inside the Perth market, see Perth Apartments Out-Yield Houses on Short-Term Rental, and for a regional Western Australia perspective, see Western Australia Rental Investment Insights. For Perth's Airbnb net-yield breakdown after all costs, see Perth Airbnb Net Yields Hit After All Costs. For a Perth-specific suburb-level breakdown, see Where to Buy in Perth: Outer Suburbs Lead on Rental Yield. The Western Australia rental market insights provides a state-wide overview.

Investment Bottom Line for Perth

Short-term rental is the higher-revenue strategy in Perth at typical occupancy, but the strategy choice depends on the investor's profile, time, and tax position. Cash-flow-focused investors who can hit or exceed the {{str_occupancy_pct_fmt}} regional occupancy benchmark and run the property hands-on are likely to be best served by short-term stays. Higher-income investors looking for tax shelter and capital growth, with no appetite for active management, are likely better served by long-term rental and negative gearing.

Stamp duty, settlement costs, and other transaction costs apply on purchase in Western Australia. Rates are banded and change periodically; check current rates with your conveyancer before committing.

Data reflects market conditions as of {{data_date}}. Data sources and market score methodology are documented separately.

This information is for educational purposes only and should not be considered financial or legal advice. Regulations and market conditions change frequently. Verify current rules with local authorities before making investment decisions.