Hobart rental market heats up
Hobart house rents grew by 4.5 per cent in the three months to December 2014, while activity in other capital cities remained subdued, new figures reveal.
The latest research from CoreLogic RP Data depicts modest house rent growth across other capitals in the final months of 2014, with Brisbane rising 2.5 per cent, Adelaide 1.4 per cent, Canberra 1.1 per cent and Sydney 1.0 per cent.
Melbourne was the only capital to record unchanged growth, with weekly house rents remaining steady at $385 per week.
The country’s unit rental market performed somewhat weaker in the final quarter of 2014.
Only Hobart and Brisbane, with rent growth of 1.8 per cent and 1.3 per cent respectively, recorded an increase, while rents for units stayed the same for Canberra and Adelaide. Units across other state capitals experienced a decline during this period.
Although the country recorded subdued rental market performance over the 2014 final quarter, CoreLogic RP Data reports that annual advertised rents have risen.
Advertised rents have grown by 2.6 per cent since December 2013 for both units and houses, while house rents have risen by 1.2 per cent across the combined capitals. Over the year to December 2014, advertised rental growth for units has been even stronger at 2.5 per cent.
For house rents, the strongest-performing market was Hobart, where the median advertised weekly rent was 3.8 per cent higher.
Sydney and Adelaide recorded the same advertised rental growth figure of 2.9 per cent. Brisbane and Melbourne achieved steady annual growth when compared to December 2013, with rents of 2.5 per cent and 1.3 per cent respectively.
The same could not be said for Perth, with the WA capital recording a drop of -6.3 per cent in advertised weekly rents since December 2013. Canberra results weren't much better, with a fall of -5.0 per cent.
The capital city unit rental markets remained unchanged for Adelaide and Darwin over the year, while Hobart at 3.7 per cent, and Sydney at 3.1 per cent, were the top performers.
As with houses, Canberra (-7.3 per cent) and Perth (-4.4 per cent) were the weakest performers amongst the capital city unit rental markets, and the only two cities to see rents fall over 2014.
CoreLogic RP Data research analyst Cameron Kusher expects the country’s subdued rental market performance in 2014 to continue into this year.
“While rental growth remains slow, rents still increased over the year in most cities, with Perth, Darwin and Canberra the exceptions. Given the recent high number of dwelling approvals and commencements coupled with the high level of purchase activity from investors, we would anticipate that the rate of rental growth will remain soft throughout 2015.”
Mr Kusher also said that rental market activity will largely depend on broader economic conditions – which remain mixed.