Tenants can expect little relief from higher rents due to declining rental affordability in most state capitals, according to Andrew Wilson, chief economist for the Domain Group.
“High migration and low numbers of first-home buyers are continuing to fuel already strong demand [for rentals]. Recent record level housing construction has failed to ease rental markets, particularly in Sydney, Melbourne and Canberra,” Wilson said.
House rents are increasing in most capitals
House rents are continuing to rise, with rental markets in most capital cities tightening and providing no relief for tenants in the March quarter.
Among the capitals, Hobart recorded the highest growth rate of 5.7%, reaching a new record high of $370 per week. Perth’s house rents are also $370 per week.
Melbourne’s house rents also rose strongly over the March quarter, rising by 2.4% to $420 per week, followed by Sydney, which was up 1.9% to $550 per week. In Brisbane, house rents rose 1.3% to $405 per week.
“Canberra, Hobart, Melbourne and Sydney houses rents have each increased sharply over the year ending March, rising by 7.5 per cent, 5.7 per cent, 5.0 per cent and 4.8 per cent respectively,” Wilson said.
Adelaide’s house rents underwent no changes over the quarter, staying at $360 per week. Canberra and Darwin’s house rents also underwent no changes over the quarter, staying at $500 per week and $550 per week respectively.
Unit rents are increasing in most capitals
Unit rents rose in most capitals over the March quarter. Melbourne recorded the highest growth, rising sharply by 3.9% to $395 per week. This was followed by Sydney, (up 1.9% to $530 per week), Canberra (up 1.8% to $428 per week), Adelaide (up 1.7% to $295 per week), and Brisbane (up 1.3% to $380 per week).
“Hobart and Perth unit rents were steady over the quarter, however Darwin fell by 2.3 per cent,” Wilson said. Unit rents in Hobart and Perth both stayed at $300 per week, and Darwin’s fell to $430 per week.