Property values may be rising, but rental growth has slumped to its lowest annual rate in more than a decade.
The recent CoreLogic RP Data Rental Review revealed that rental growth is sitting at its lowest point in more than 10 years, with combined capital city rent increasing by just 1.8% over the past 12 months.
CoreLogic RP Data said a surge in off-the-plan apartment approvals and sales recorded through 2014 will negatively impact asking rents in 2015.
In the last quarter of 2014, asking rents for houses were most affordable in Hobart at $343 a week and Melbourne at $385 a week. Darwin rents were highest at $645 a week, despite falling just under 1% for the year, followed by Sydney at $525 a week.
Darwin was also the most expensive capital city in which to rent a unit, with a $550 median weekly asking rent. Sydney’s weekly unit rent was $495 a week.
Melbourne’s median asking rent for units was $360, which was in line with the national median.
Canberra was the worst-performing capital for property investors, with rents down more than 7%. They also fell in Perth, by 4.4%.
CoreLogic RP Data research analyst Cameron Kusher said rental growth was the most subdued it had been since the mid-2000s.
“While rental growth remains slow, rents still increased over the year in most capital cities, with Perth, Darwin and Canberra the exceptions,” Mr Kusher said.
“Given the recent high numbers of dwelling approvals and commencements coupled with high levels of purchase activity from investors, we would anticipate that the rate of rental growth will remain soft throughout 2015.”
John can be contacted on 0749722081 or 0410433919. or email him at jwhitten@ihl.net.au or net www.ihl.net.au. John Whitten is a credit representative (CRN 399796) of BLASSA Pty Ltd (Australian Credit Licence No 391237).
