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By Mike Mortlock
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Landlord Exodus: Victoria Likely to Lose Thousands of Rentals in the Next 12 Months

key takeaways

Key takeaways

Victoria's rental market is facing significant challenges, with a net loss of 5,044 rental properties over the last three months, and a downward trend in investor loans indicating a broader reluctance among investors. This is further shrinking the available rental stock, making it harder for tenants to find affordable housing.

To address this crisis, we need to avoid the blame game and focus on constructive solutions. Demonising landlords will only make things worse for long suffering renters.

The Sydney rental market is relatively stable, with ex-rentals replenishing the market's private rental stock. This is despite fluctuations in investor activity, ensuring a balanced level of private rental properties for tenants.

Queensland is experiencing a positive trend in its rental market replenishment levels, with an estimated net gain of 8,600 rental properties over the next 12-months. This is crucial for maintaining rental affordability and availability across the state.

The Victorian rental market is facing a significant crisis, with our latest data revealing a concerning trend of declining investor activity and a net loss in rental properties.

In our most recent analysis of the Australian housing market, we evaluated the trends and shifts in investor loans and ex-rentals across the nation.

Victoria is facing significant challenges in its rental market.

Victoria’s rental market is in a precarious position.

Over the last three months, investor loans in Victoria totalled 10,220, resulting in an annualised figure of 40,880.

During the same period, annualised exrentals were calculated at 45,924, indicating a substantial loss of rental properties.

This means we’re looking at a net loss of 5,044 rental properties which reflects a 1.0% decrease in the state’s private rental stock over the coming year.

This decline is concerning, as it suggests that Victoria’s rental market is not replenishing its private rental stock at a sufficient rate.

The downward trend in investor loans exacerbates this issue, potentially leading to higher rental prices and reduced availability for tenants.

Investor exodus Victoria

The issue is not just about existing landlords exiting the market; potential new landlords are also wary of investing in Victoria.

The trend suggests a broader reluctance among investors, exacerbated by policies and market conditions that dissuade investment in the state’s rental properties.

Landlords are increasingly cautious about entering the Victorian market.

It’s not just about those who are leaving. Many potential investors are now avoiding Victoria altogether, seeking opportunities in other states with more favourable conditions.

This reluctance to invest is further shrinking the available rental stock, making it harder for tenants to find affordable housing.

To address this crisis, it’s crucial to avoid the blame game and focus on constructive solutions.

Demonising landlords can lead to a worsening situation for renters, who are already feeling the pinch of reduced rental availability and higher prices.

We need to resist the temptation to point fingers at landlords.

Blaming them as the bad guys will only exacerbate the problem, making things even worse for long suffering renters.

Instead, we should work on creating a more supportive environment for property investors, which in turn will help stabilise and grow the rental market.”

Sydney rental market stable

New South Wales is experiencing a relatively stable rental market in terms of replenishing ex-rental stock.

Over the last three months, investor loans in NSW totalled 13,472, resulting in an annualised figure of 53,888.

During the same period, annualised ex-rentals were calculated at 44,880, indicating that the market is successfully replenishing its private rental stock.

The net gain of 9,008 rental properties reflects a 1.4% increase in the state’s private rental stock.

This positive trend suggests that NSW is effectively maintaining its rental market stability despite fluctuations in investor activity, ensuring a balanced level of private rental properties for tenants albeit in a tight market for renters.

Rentals Sydney

Queensland rental market positive

Queensland is experiencing a positive trend in its rental market replenishment levels.

Over the last three months, investor loans in QLD totalled 10,556, resulting in an annualised figure of 42,224.

During the same period, annualised ex-rentals were calculated at 33,624, indicating a healthy influx of new rental properties.

The estimated net gain of 8,600 rental properties reflects a 2.1% increase in the state’s private rental stock over the next 12-months.

This positive balance suggests that Queensland is effectively replenishing its private rental stock, ensuring a stable and expanding supply of rental properties for tenants.

This trend is crucial for maintaining rental affordability and availability across the state considering the current high levels of rental stress.

Queensland rentals

About Mike Mortlock Mike Mortlock is a Tax Depreciation expert, Quantity Surveyor and Managing Director of MCG Quantity Surveyors. He is a regular property commentator having been featured in the Financial Review and Sky Business. MCG Specialise in Tax Depreciation Schedules and Construction Cost Estimating for investors. You can visit them at www.mcgqs.com.au
10 comments

It is true in the short term, but not everyone wants or is able to buy, so what happen to them when there is less rental properties on the market?

2 replies

Perth is probably the best fairing state with regards to tenancy laws. Just thought i'd let you know.

1 reply

This is the result of living in a state with higher tax rates and significant debt caused by prolonged lockdowns. Many investors and businesses are avoiding Victoria and choosing to invest in other states instead.

1 reply
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