Rental rates continue to show their weakest performance since 1996, new data has revealed.
The research from CoreLogic RP Data shows capital city rental rates continue to record no change over the year. According to the February data, weekly rents across the combined capital city measure increased 0.3% over the month; however rents were unchanged over the past 12 months.
At the same time last year rental rates had increased by 1.7%.
CoreLogic RP Data research analyst Cameron Kusher says this suggests rental rates could begin to fall on an annual basis due to additional new rental supply entering the market.
“With construction activity set to peak over the next 24 months, and with many new properties still to settle, there is a real possibility that rental rates will fall over the coming months.
“Based on our expectations, landlords have little scope to lift rental rates while for renters, it potentially means more surety in securing accommodation and the potential to upgrade into a higher level of accommodation for a similar cost.
“The cause of this current slowdown in rental growth is falling wages, excess rental supply in certain areas and lower rates of population growth and population mobility impacting on demand for rental accommodation.”
Rental rates increased over the year to February in Sydney (1.5%), Melbourne (2.2%) and Canberra (1.6%). Rents in Hobart remained unchanged. However, rents have fallen over the year in Brisbane (-0.7%), Adelaide (-0.4%), Perth (-8.4%) and Darwin (-13.3%).