Apartment rent increases have outperformed those from houses over the past five years, according to the latest RP Data rental report.
Capital city rents increased at an average annual rate of 7.9% for units compared to 7% for houses over the past five years. At the same time apartments have had generally similar if not better capital growth.
Rental demand for units has been even stronger in the last 2 years with capital city house rents increasing by just 4.1% while units have outperformed with rents increasing by 8.6%.
“The result reflects changing lifestyle patterns and the ongoing densification of inner-city areas and subsequent increasing demand for rental units in these regions,” said Cameron Cusher of RP Data.
Rents for apartments are most expensive in Sydney ($450/week) and Canberra($430/week).
The most affordable rental units are in Hobart ($280/week), Adelaide ($290/week) and Melbourne ($350/week).
Pilbara in the WA has the most expensive rents of all rental markets, at $1,650 a week for houses, according to RP Data. But if you’ve been following my blogs, you’d know that’s not an area where I’d invest – not matter how high the rents are.
The national median rental rate is currently $360 a week with the combined capital city median at $380. Weekly rental rates increased nationally by 2.9% over the past year – slightly higher than the 2.7% increase in the capital cities.
According to the results, rental growth has tracked below average over the past 12 months; a trend which has been evident since early 2008 when rental demand started to slow.
“Combined capital cities rents increased by 2.7% over the year, which is below the inflationary figures to March 2011,” Mr Kusher said.
Source: RP Data
SUBSCRIBE & DON'T MISS A SINGLE EPISODE OF MICHAEL YARDNEY'S PODCAST
Hear Michael & a select panel of guest experts discuss property investment, success & money related topics. Subscribe now, whether you're on an Apple or Android handset.
PREFER TO SUBSCRIBE VIA EMAIL?
Join Michael Yardney's inner circle of daily subscribers and get into the head of Australia's best property investment advisor and a wide team of leading property researchers and commentators.