Rental growth at record levels
A recently-released rental report has revealed rents in most capital cities have remained at or near record levels over the past quarter.
The Domain Group rental report said the December national capital city vacancy rate for houses was two per cent, with units at three per cent, for an overall dwelling vacancy rate of 2.4 per cent.
Domain Group senior economist Dr Andrew Wilson said despite record levels of investor activity and increased dwelling construction, demand for rental properties continues to outstrip supply, resulting in tight vacancy rates and high asking rents in most capital cities.
The report said Sydney, Adelaide and Hobart recorded increases in the median asking rent for houses, while all other capital cities remained steady over the December quarter.
Median weekly asking rents for units in all capital cities, except Melbourne and Perth, remained steady or increased over the quarter.
“In the unit market, Sydney, Adelaide, Hobart and Canberra recorded increases, while Darwin and Brisbane remained steady and Melbourne and Perth recorded decreases,” Dr Wilson said.
“In Perth, we are continuing to see an adjustment of the rental market, while Melbourne landlords are feeling the effect of recent new apartment construction.”
Of all the capital cities over the quarter, Hobart saw the strongest increase in asking rents for both houses and units, which rose by 3.2 per cent and 3.8 per cent respectively. The city, however, retains its position as Australia’s most affordable capital for rental property.
Sydney and Adelaide also saw increases to both house and unit asking rents.
In Canberra, the asking rent for houses remained steady, while unit rents rose by 2.6 per cent over the December quarter.
Asking rents for houses and units in Brisbane and Darwin remained steady over the quarter.
“Upward pressure on rents is set to continue through 2015, particularly in the robust Sydney market where underlying demand continues to outstrip supply,” Dr Wilson said.