In this article, CoreLogic Head of Research Eliza Owen analyses rental markets across Australia's combined capitals and identifies the cheapest rents within 20km of CBDs.
Across the combined capital city markets of Australia, rent values have risen another 10% in the 12 months to September. Limited availability of stock, a strong net overseas migration position and a normalisation between city and regional population movements continues to place upwards pressure on capital city rent markets. For those that work or study in the city centre, rent options are looking increasingly thin, and once relatively unpopular areas may be bourgeoning with rental demand from high-income professionals.
This report identifies the five lowest median rents for houses and units within 20 km of Central Business Districts (CBDs). The analysis is based on suburb-level markets, where there was a minimum of 20 rent listings counted over the past year. Only markets with a high confidence median value, as evaluated by CoreLogic were included in the analysis. All data is to September 31st.
The results are unpacked by city below. From the gentrifying Inner South West of Sydney to the flood-prone properties of Rocklea in Brisbane, the analysis reveals that while some suburbs may be hidden gems for renters and investors alike, others are priced with low rents for a reason.
The lowest rents within 20 km of the Sydney CBD were concentrated across Parramatta and the Inner South West. House rents in this list ranged from $648 in Auburn to $676 in Granville, which is around -15% lower than the greater capital city median of $775 per week. The unit markets pose particularly good value, with median rents averaging around -27% lower than the Greater Sydney median unit rent of $680 per week.
For students at Western Sydney University campuses in Parramatta and young health professionals, these markets may be ideal rental regions. Lakemba, which has the closest average proximity to the CBD among the top five, is also an easy commute to Sydney’s trendy inner west, where there are an abundance of entertainment venues, breweries and popular restaurants. From an investor perspective, some of these areas may also be attractive. Each of the unit markets on the list have a gross rent yield of over 5%, and Lakemba units are currently recording a gross rent yield of 6.2%.
Eight of the 10 markets with the lowest rents 20 km from the Melbourne CBD were in Melbourne’s West. The lowest house rents averaged $442 per week, or -23% below the Greater Melbourne weekly rent value of $575.
Despite being within 20kms of the CBD, commute times from suburbs like Albanvale and Kings Park to the city are around an hour by public transport. This means they may not be ideal locations for students or young professionals working in the city, but for young families these suburbs offer relatively low-priced house rents. There are nearby employment hubs around industrial and warehousing precincts in the city’s west, and by car the city is around a half-hour away.
Across the cheapest unit markets identified, median rents range from $366 per week in Albion, to $420 a week in Thomastown. Rents across these suburbs are trending around -24% below the Greater Melbourne median of $528 per week. Albion units had the cheapest median value of these suburbs at $406,343, with rent yields recorded at 5.0%.
The lowest median weekly rents within 20 km of the Brisbane CBD were largely across Ipswich and the Logan – Beaudesert market. For house rents, weekly rent prices averaged around -19% below the Greater Brisbane median, and unit markets featured were around -22% lower.
Woodridge had the lowest median weekly rents for both houses ($501 per week) and units ($352 per week). Woodridge units were not only the cheapest median weekly rents within 20km of the Brisbane CBD, but were the lowest of the median weekly rents across all the capital city markets analysed within the 20 km range. The suburb is around a 20-minute commute to the Brisbane CBD via Springwood station, and is conveniently located within Logan on the Karawatha Forest, and commercial centres of Logan Central and Slacks Creek. Rent yields across units in this market were recorded at 7.0% in September.
The lowest median weekly rents with closest proximity listed was Rocklea, where house rents were recorded at $544 per week in September. While only around 25 minutes drive from the CBD, Rocklea is a relatively high flood risk area of Brisbane, and is priced at a low level to the neighbouring house markets of Salisbury ($624 per week), and Moorooka ($664 per week).
Eight of the 10 cheapest markets within 20 km of Adelaide CBD were in the North Adelaide region, with St Marys units in Adelaide’s south, and Taperoo in the west, being the exceptions. Adelaide rent values have climbed 7.2% in the past year, and 32.9% since the start of the pandemic, with median house rents sitting at $568 per week, and units at $463.
The lowest house rents within 20 km ranged from $473 across Salisbury to $502 in Taperoo, placing median rents around -14% below Greater Adelaide median house rents. The lowest weekly unit rents ranged from $361 per week in Salisbury East, to $403 in St Marys, averaging -16% below the city-wide median.
Taperoo stands out as one of the most unique suburbs to make a list of cheap rentals. It is located on the LeFevre Peninsula, where the suburb boasts a beautiful foreshore and beach. Taperoo is an eight-minute drive to Port Adelaide, which is bourgeoning with breweries and cafes. It might not be a first choice of rental markets for young professionals or students, but for those willing to commute around an hour by train to the city, it’s a relatively affordable beach front setting.
Perth rents have seen the largest cumulative uplift of any capital city rent markets since the onset of the pandemic, at 44.9%. With median weekly rents across the dwelling market sitting at $604 in September, this is the equivalent of an uplift in the median rent value of $186. As population growth surges across Western Australia, and monthly rent growth remains high, no doubt relatively cheap pockets of the city will become more popular.
The lowest house rents within 20 km of the Perth CBD ranged from $491 in Girrawheen to $519 per week in Koondoola. Each house market featured on the list recorded gross rent yields of at least 6.0%, and median values under $500,000. Koondoola houses were the closest to the CBD at 12 km, and the suburb is around a half-hour drive to the CBD. The spacious suburb is also home to the Koondoola Regional Bushland nature preserve. Overall, house rents in these suburbs average -17% below the Greater Perth median house rent value ($613).
The lowest unit rents within 20 km of the CBD ranged from $433 per week across Midland to $462 per week in Coolbellup. Similar to the house markets featured, gross rent yields across these unit markets were high, ranging from 6.7% in Hamilton Hill to 7.6% in Gosnells. The closest unit market to the CBD, Noranda, is fairly thin on amenities and entertainment for young professionals and students, but there is a lively commercial precinct just south in the suburb of Morley.
Unlike most cities, Hobart is experiencing a slight decline in rent values, albeit off the back of an extended boom in rents throughout the 2010s. Rent values have declined -1.7% in the past year, with the median house rent value sitting at $541 per week, and units at $463.
Within 20 km of the centre of Hobart, the lowest median house rents ranged from Bridgewater ($485 per week), to Berriedale ($516). Rents in these suburbs averaged -7% below the median for Greater Hobart. Berriedale was the closest of the house markets to the city centre, and had a relatively high gross rent yield of 5.1%. The suburb is accessible to the city via a half-hour bus ride, or a 20-minute drive.
The unit market observations were fewer for Hobart, with the lowest median rents ranging from $411 per week in Claremont, to $463 per week in New Town. The average weekly rent across the featured unit markets were $437, which is only around -6% lower than the median weekly rent across Greater Hobart.
Similar to Hobart, Canberra is one of the few capital city markets seeing an annual decline in rent values. Rents across the greater ACT were down -3.0% year-on-year. Despite the recent fall, ACT rent values are among the most expensive of the capital city markets to rent in. In September, the median weekly house rent across the ACT was $686, while the median weekly unit rent was $569.
The lowest median house rents identified across Canberra ranged from $597 per week in Higgins, to $599 per week in Holt, Page and Charnwood. Rent values in these house markets averaged -12.7% below the city-wide median. Page was the closest of these suburbs to the centre of Canberra, as well as being in close proximity to a lively commercial centre in Belconnen, and is less than 10 minutes’ drive to the University of Canberra. Higgins and Scullin, which have marginally lower median house rents, are just to the west of Page.
Of the unit markets identified with the lowest median rent within 20 km of the Canberra CBD, median rents ranged from $468 per week in Lyons to $529 in Gungahlin. These averaged around 11% lower than the city-wide median unit rent. Unlike the cheaper house rent markets, which were concentrated in Canberra’s north-west, Lyons, Chifley and Mawson are in the south of the city. However, they are still a relatively short drive from the city centre, and are closer to the Australian National University than University of Canberra.
Similar to Perth, strength in the resources sector in the past few years, combined with more favourable migration trends, have seen Darwin rents grow quickly since March 2020. Since the onset of the pandemic, Darwin rents are up 35.7%, or the equivalent of $162 per week at the median rent value across the city. As of September, the median Darwin house rent was $675 per week, while the median unit rent was $519.
The lowest house rents identified were across Moulden, Gray, Driver, Woodroffe and Bakewell. Median rents in these house markets ranged from $539 per week to $591, averaging -16% below the median house rent across greater Darwin. Each of these markets is located in the Palmerston region.
Closer to the city and coast line, unit rents in Millner and Coconut Grove recorded a median of $478 and $475 respectively. These sit well below the greater Darwin median, and from investment perspective these rent markets have gross rent yields of over 7%.