Rents in most capital cities continue to rise due to an ongoing shortage of rental properties, according to the March Domain.com.au Rental Report.
Unit rents increased in Sydney, Melbourne, Brisbane, Hobart and Canberra over the March quarter, the report revealed.
Domain.com.au senior economist Dr. Andrew Wilson says rents remain at record levels despite the recent national apartment building boom intending to provide more available rental stock to capital city markets.
“Despite the recent influx of home building, we can expect to see upward pressure on both house and unit rents in most capital cities continuing in the foreseeable future.
"However, the clear exceptions to tight capital city rental markets are Perth and Darwin. Rents in these cities continue to fall reflecting the impact of the downturn in the resource economy and the end of the significant rental demand driven by a fly-in fly-out workforce.”
In Sydney, median unit rents increased sharply over the March quarter. The median unit rent was recorded at $520 per week, whilst for houses it was $530. Sydney unit rents have now increased by 4% over the past year.
Weekly median prices for houses remained unchanged over the March quarter, however, have increased by 1.9% over the year.
“Despite the significant numbers of new apartments entering the market, Sydney unit rents bounced back this quarter with a sharp 4% increase in the median weekly rental. This increase offers no relief for tenants with house rents remaining at record highs and already low vacancy rates continuing to tighten,” Dr Wilson said.
In Melbourne, median weekly unit rentals increased to $380 over the March quarter, reflecting a 4.1% annual increase – the highest unit rental growth rate of all capitals.
Melbourne house rents consolidated at the record $400 per week, an increase of 2.6% over the year.
“It has been a positive quarter for investors in Melbourne with unit rents now rising to record levels and vacancy rates falling, despite an unprecedented new apartment boom. Melbourne house rents remain at peak values as well, with low vacancy rates indicating no relief in sight for tenants,” Dr Wilson said.
House and unit rents in Brisbane increased by 2.5% and 2.7% respectively over the past year. In Adelaide, unit rents remained unchanged while house rents climbed by 2.9%.
House rents rose by a massive 6.1% in Hobart while unit rents rose by 1.8% over the year. In Canberra, house rents increased by 4.4% over the past year with unit rents up by 1.3%.
Rents in Perth and Darwin, however, declined over the year. The median weekly house rent fell by 11.1% in Perth and unit rents fell by 9.1%. Darwin house and unit rents also fell steeply over the past year, down 15.4% and 13.5% respectively.