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Rental growth lowest for a decade

It’s just that stage of the property cycle – property prices are going up, but rents are not. 

The latest CoreLogic rental report shows that over the 2014 calendar year, advertised rental rates on a national basis increased by 2.6 per cent for both houses and units.

At a capital city level, the rental performance across the different housing stocks was more varied.

House rents rose by 1.2 per cent over the year, while unit rents outperformed the detached housing market, up 2.5 per cent over the 12 months to December 2014.

rents January 2015

Houses – Performance in the December Quarter Variable

Rental growth was poor overall over the last 3 months and varied from state to state.

  • Hobart house rents rose by the most, up 5.4 per cent over the three month period;
  • Brisbane 2.5 per cent;
  • Adelaide 1.4 per cent;
  • Canberra 1.1 per cent;
  • Sydney 1.0 per cent;
  • Perth -2.2 per cent & Darwin -0.8 per cent the weakest performing rental markets for houses over the three month period;
  • Melbourne was the only capital city market to record no change, with weekly rents for houses stable at $385 per week.

Units – Performance = Somewhat weaker in the last 3 months

Rental growth for apartments was even weaker than house rental growth in the last quarter

  • Hobart 1.8 per cent & Brisbane 1.3 per cent, were the only capital cities where rents rose over the three months to December;
  • Remaining capital cities saw rents fall over the last quarter of 2014 with the exception of Adelaide and Canberra where no change was recorded.

 



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Michael is a director of Metropole Property Strategists who help their clients grow, protect and pass on their wealth through independent, unbiased property advice and advocacy. He's once again been voted Australia's leading property investment adviser and his opinions are regularly featured in the media. Visit Metropole.com.au


'Rental growth lowest for a decade' have 2 comments

  1. Avatar for Property Update

    January 13, 2015 @ 10:41 am Ewa Janes

    My daughter is buying an investment in Campbelltown, off the plan in the best possible spot, walk to station, walk to major shopping centre, walk to university and 2 minutes from a major hospital and 50 mins by train to sydney. 2 beds, 420 thou. Rent minimum 420 pw. It all seems perfect but I’ve hit doubts since your negative thoughts on off the plan purchases. She can’t afford the ridiculous city prices but is already buying a great place in summer Hill which has appreciated big time and has a rental in North Parramatta which is in neutral. Is she making a mistake? I’m just nervous for her. Best Regards, Ewa

    Reply

    • Avatar for Property Update

      January 13, 2015 @ 5:07 pm Michael Yardney

      Ewa
      I don’t know your daughter’s financial situation so I can’t really reassure you.
      What I can say is that Campbelltwon does not fit in with my strict criteria for choosing an investment property, no matter how good a location there. You’ll find plenty of commentary on this site on what makes a good location and 50 km from the CBD doesn’t cut it in my opinion

      Reply


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