The first CoreLogic Quarterly Rental Review for 2019, which tracks median rents and rental yields across Australia, shows that national weekly rents have risen by 1 per cent during the first three months of the year.
“This seasonally strong first quarter has delivered the highest increase in weekly rents since the corresponding first quarter a year ago”, says Cameron Kusher, Research Analyst for CoreLogic. “Our regional housing markets are performing marginally better than the capital cities, many of which have been experiencing weaker rental market conditions in recent years due to excess housing supply and growing investor activity.”
“Quarterly rents have increased across all capital cities, bar Sydney and Darwin. Hobart is experiencing notable growth, with rents increasing by 3.6 per cent over the past quarter. However, with a median rent of $582 per week, Sydney remains Australia’s most expensive city for tenants by far.”
The Quarterly Rental Review also highlights a national increase in yields over the past three and 12 months. Gross rental yields for the first quarter are 4.10 per cent compared to 3.95 per cent in the previous quarter and 3.77 per cent a year ago. Darwin has the highest rental yield across the country with an annual median of 6 per cent.
Key findings – rents and yields
- Nationally, rents increased by +1 per cent over the March quarter and by 0.4 per cent over the past 12 months. Combined capital city rents were 0.9 per cent higher than the December 2018 quarter but -0.1 per cent lower than the previous March quarter. This is the lowest annual change since CoreLogic started tracking rents in 2005. Regional rents were slightly stronger, with a 1.1 per cent increase over the quarter and a 1.8 per cent increase over the past year.
- In the first quarter, rents climbed in all capital cities except for Darwin (-0.3 per cent). Hobart was by far the strongest performer, with a 3.6 per cent increase in rent over the past quarter, followed by Perth (+1.8 per cent) and Canberra (+1.5 per cent). Hobart also experienced the highest increase in rent over the past 12 months (+5.4 per cent) while at the other end of the scale the media rent in Darwin fell by -5.7 per cent.
- Nationally, the median rent is $436 per week. The median rent across the capital cities is $465 per week, and $378 per week across the regionals.
- Gross rental yields have increased from 3.8 per cent to 4.1 per cent nationally. Across the combined capitals, the average rental yield is 3.8 per cent (up from 3.5 per cent). Regional yields are far higher at 5.1 per cent, up from 4.9 per cent 12 months ago.
Key findings – capital cities
- Sydney remains Australia’s most expensive capital city market, with a median weekly rent of $582, despite a decline of -3.1 per cent over the past 12 months. While rents in Sydney remained the same as the previous month, they increased by 0.5 per cent over the past quarter. Sydney also has the lowest rental yields out of all capital cities, at 3.5 per cent over the past quarter.
- Canberra reports a median rental cost of $550 per week, an increase of 1.5 per cent over the past quarter and 3.6 per cent over the past 12 months. Canberra is one of only two capital cities (alongside Darwin) to experience a drop in weekly rent over the past month (-0.1 per cent).
- In Melbourne, rents are $454 a week – an increase of 1 per cent over the quarter and 2.1 per cent over the past 12 months. Melbourne also reported the greatest increase in rental yields out of all capital cities, with current rental yields being 3.6 per cent, compared to 3.1 per cent a year ago. Despite the rise in yields, Melbourne has the second lowest weekly rental yield out of all capital cities (after Sydney).
- Brisbane rents are starting to climb again, with Brisbane now having a median weekly rent of $436. This is an increase of 0.8 per cent over the past quarter, and 1.4 per cent over the past 12 months.
- Perth is the most affordable capital city to rent in with a median weekly rent of $385. However, it is showing signs of growth, achieving the second highest quarterly rate (after Hobart) with an increase of 1.8 per cent over the past 3 months. Over the past year, Perth rents have increased by 2.1 per cent.
- Adelaide closely follows Perth to become the second most affordable capital city to rent a property in, with a median weekly rent of $386. Like Brisbane, it experienced a 0.8 per cent rise in rents over the March quarter. Over the past 12 months, rents in Adelaide have risen by 1.2 per cent. Gross rental yields have remained static over the year at 4.4 per cent.
- Hobart reported the strongest growth in rents, up 3.6 per cent over the past quarter to $453 per week. Over the past year, rents have increased by 5.4 per cent. Hobart also reports the strongest growth over the past month, with a 1.6 per cent increase in weekly rent. Hobart also reported the second highest rental yield (after Darwin) of 5.1 per cent, which remained the same as 12 months ago.
- Darwin has experienced the most significant decline in rent to achieve a median weekly rent of $458. This is down -0.3 per cent over the quarter and -5.7 per cent over the past year. In addition, Darwin also reports a drop of 0.2 per cent over the past month. However, at 6 per cent, Darwin has the highest gross rental yield out of all the capital cities (up 0.1 per cent on the past 12 months).