Data released earlier this month showed that over the 12 months to June 2016 combined capital city rental rates had fallen by -0.6%. While capital city rental rates are broadly falling, there are regions where rents are still rising.

Combined capital city rental rates fell by -0.6% over the 12 months to June 2016, with falls recorded over the year in Brisbane, Adelaide, Perth and Darwin and rental growth slowing from already low levels in most other capital cities. While capital cities have seen a slowdown in rental growth, the list of council areas with the highest annual increases in rental rates are dominated by regional areas of the country.

The following lists are based on median advertised weekly rents. Those council areas listed have had at least 50 advertised rents over the 12 months to June 2016.

Council areas with greatest annual changes in
house rents, 12 months to June 2016

The first table highlights the 25 council areas nationally that have had the greatest increase in house rents over the past year. Only one council area listed (Manly (NSW)) is located within a capital city. Regional areas on NSW dominate the list accounting for 16 of the 25 council areas listed. Vic and SA each have four council areas listed and Qld has one region listed. Many of the regions listed are mid-sized regional markets with many of them located in lifestyle locations.

Looking at the list for units, only three of the 25 council areas listed are located within a capital city (Hobart, Pittwater and Wyndham). NSW dominates the list with 13 regions with the number of council areas across the remaining states recorded at: six in Vic, two in Qld, one in SA, one in WA and two in Tas. Most of the top 25 regions listed are coastal lifestyle markets.

Council areas with greatest annual changes in
unit rents. 12 months to June 2016

While rental rates are falling in many capital city regions, this data suggests that in mid-sized and coastal regional markets rental demand is picking-up. These regions have also been seeing a rise in migration over recent years, perhaps we are seeing evidence of try-before-you-buy in these regions. With those migrating to these areas deciding to initially rent in these markets before fully committing to a purchase. The fact that for units rents are increasing in many coastal locations is potentially reflective of the recovering markets spurred by the lower Australian dollar and subsequent improving tourism sector.