Rental rates across the nation were -0.1% lower in December 2018 and were recorded at a median value of $433/week. While rents fell -0.2% to $462/week across the combined capital cities over the month, rents in the combined regional markets increased by 0.2% to sit at $373/week.
The CoreLogic Quarterly Rental Review has just been released, providing an update on rental market conditions through to December 2018. The report found a mixed situation, with rents falling in Sydney, Darwin and Canberra, a fairly significant slowdown in rental growth for Melbourne, but growth elsewhere.
CoreLogic research analyst Cameron Kusher said, “Sydney and Melbourne are both seeing the impact of significant demand from investors over recent years, along with a substantial ramp-up in new housing supply (largely apartment), much of which was purchased by investors. Darwin rents have been falling for many years and they continue to decline.”
Rental markets are on the up in Brisbane and Perth, after a number of years in decline. Rents are also continuing to rise elsewhere; however the rate of growth has slowed compared to a year ago.
Sydney remains the most expensive capital city in which to rent, with a median rent of $583/week (which is $43/week more expensive than the second most expensive in the country of Canberra at $539/week). Hobart has historically been the most affordable capital city rental market, however strong rises in rents over recent years have pushed rental costs well above those in Adelaide and Perth and are actually now marginally higher than rents in Brisbane.
Key report highlights include:
- Australia’s weekly rents fell by -0.1% in December 2018 to be -0.3% lower over the fourth quarter of 2018, however rents increased by 0.5% over the 12 months to December 2018.
- Capital city rents were -0.4% lower over the quarter and unchanged year-on-year while regional market rents were 0.3% higher over the quarter to be 1.8% higher over the past 12 months.
- The annual change in both combined capital city and national rents is the lowest on record based on data which is available back to 2005.
- Over the past 12 months, rents have increased in all capital cities except for Sydney and Darwin.
- Brisbane and Perth are the only two capital cities in which the annual change throughout 2018 has accelerated relative to the change in 2017.
- Gross rental yields are rising, currently recorded at 3.95% nationally at the end of December 2018 compared to 3.85% at the end of the previous quarter and 3.73% a year ago.
- Gross rental yields have increased over the past 12 months in all capital cities except for Hobart and Darwin.