Good news for property investors as rents surge
Talk of oversupply could be overblown in one Australian capital, as unit rents have surged over the quarter.
Apartment rents in Sydney have jumped $20 compared to the March quarter last year, rising from $500 to $520. Domain Group’s March Quarter Rental Report shows that unit rental prices are now almost equal to median weekly asking rent for houses, which remained unchanged at $530 a week. Melbourne has seen a similar rise, with unit asking rents up $15 to $380. By comparison, the median asking rent on a house in Melbourne is $400.
"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," Domain Group senior economist Andrew Wilson said.
In good news for investors, rental growth was positive across most Australian capitals. Hobart saw the most significant rise, with median asking rents for houses increasing 6.1%. Rents declined significantly in Darwin and Perth, however. The median asking rent in Darwin fell by 15.4% for houses and 13.5% for units, while in Perth asking rent for houses declined 11.1% and unit asking rent was down 9.1%.
"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," Wilson told Fairfax.