International migration numbers are starting to surge, leading to further pressure on rental markets.
September recorded the strongest quarterly rate of national rental price growth on record, with median weekly advertised rents up by 4.3%, according to PropTrack senior economist Eleanor Creagh.
Since the start of the COVID pandemic house rents have increased by 19% while unit rents are up by 8.4%.
However, in the past quarter unit rents have started to lift, with new figures showing Melbourne unit rents are up by 5% and Sydney unit rents are up by 4%.
“That’s much more than the rental price growth rate for houses, as overseas migration and foreign student arrivals rebound,” Creagh says.
In the past 12 months rents for one-bedroom units have increased by 11.1% nationally.
Creagh says conditions for would-be tenants will continue to remain tough because of the constrained supply of available properties alongside the increased demand from international student arrivals.
“The number of highly engaged potential renters per listing on realestate.com.au in Melbourne’s city region has more than doubled in the past 12 months, with parts of Sydney also seeing large growth,” she says.
Creagh says current investor activity is unlikely to be at a level sufficient enough to significantly increase the supply of rental stock.
“With net migration continuing to rebound, without a meaningful increase in rental supply on horizon, it doesn’t look like price pressures will ease in the capital cities anytime soon.”