Good Rent Growth in Some Capital Cities

Posted on 23/05/2016  
Good Rent Growth in Some Capital Cities

The latest rental and vacancy figures from SQM Research show big differences in rental performance in the various capital cities.

Based on data to the end of April, there’s been good rental growth in Canberra (houses up 8.7%), Hobart (up 7.6%) and Sydney (4.8%), negligible changes in Adelaide, Brisbane and Melbourne, and big falls in Darwin and Perth.

In terms of residential vacancies, they’re high in Perth and Darwin, comfortable in Adelaide, Brisbane and Melbourne, and very low in Canberra, Hobart and Sydney.

It’s noteworthy – though not so surprising - that rental growth is in line with the vacancy figures: rents are falling where vacancies are high, stagnating where vacancies are middle of the road, and rising in the cities where vacancies are tight.

SQM Research’s Louis Christopher says the number of residential vacancies nationwide rose in April, with an average vacancy rate of 2.5% in the eight capital cities – a total of 75,749 vacancies.

“Year-on-year results demonstrate that national vacancies appear to be slightly above the common seasonal trends expected at this time of year,” he says.

"Perth recorded the largest monthly rise, with vacancies increasing by 0.5 percentage points during April. Canberra also experienced a reasonable monthly rise, with percentage points up 0.3%. In contrast, vacancies remained the same in Hobart, with a tight rate of just 0.9% based on just 240 vacancies. 

“Perth continues to record an alarming number of vacancies, particularly when one considers the amount recorded this time last year, with the vacancy rate climbing a total 1.1 percentage points.”

According to SQM Research, Darwin has recorded ongoing falls in asking rents of 8.4% for houses and 12.5% for units over the past 12 months. Yearly falls have also been recorded in Perth, with asking rents down 8.4% for houses and a considerable 9.3% for units.

Hobart continues to record the most affordable rental accommodation with rents for houses at just $350 a week, while Adelaide recorded the most affordable unit rent, averaging $285 a week.

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