Rents To Keep Growing
In good news for landlords, but not renters, capital city apartment rents are tipped to increase substantially in the next five years.
CBRE’s Apartment Vacancy and Rent Outlook predicts growth across 53 precincts in Australian capital cities by 2030.
It says 92% of two-bed apartments will have rents above $700 per week and a third will have rents above $1000 per week by 2030.
At the same time, it predicts that capital vacancy rates will fall to 1.1% by 2030, down from 1.8% in 2025.
“These tight conditions will endure as vacancy stays at around half of the previous decade’s average of 2.5%,” it says.
According to CBRE analysis, high construction costs and better amenities are putting upward pressure on rents for new builds.
It says the future supply of apartments is likely to hover around 60,000 per year in the next five years, even though about 75,000 per year are required.
The report predicts Sydney will build about 11,700 per year (although it needs about 30,000), Melbourne will receive 9000 (it needs around 38,000) and Brisbane will deliver about 4600 (it needs around 16,000).
Cotality’s latest quarterly rent review shows that unit rents grew at a faster pace than house rents over the June quarter.
“The difference in rental growth trends across property types can partially be attributed to supply,” it says.
