Rents keep falling despite increasing demand

Despite house prices remaining resilient, we know our rental markets have taken a beating due to Covid-19. Coronavirus – How Will It Impact Australia’s Property Markets

Realestate.com.au reports that for the first time on record the cost of renting in Australia has fallen.

The results are a clear indicator of how COVID-19 has changed the dynamic of the property market.

Over the June quarter headline inflation fell by -1.9 per cent – the first quarterly fall since the December 2008 quarter and the largest quarterly fall on record.

The cost of renting is taken into account when measuring CPI and over the quarter, national rents fell by -1.3 per cent which was both the largest and first quarterly decline on record.

Cost of renting

Rental rates are coming under pressure form multiple sources: we have virtually no migration and overseas arrivals into the country, there is new stimulus that is encouraging purchasing from first home buyers who otherwise may have been renters and then there’s the fact that unemployment is rising and younger people are most affected.

While growth in rents had been slowing and was unchanged over the December 2019 quarter, the fall was unprecedented.

Nationally, the cost of renting is now back at levels last recorded in March 2017.

Breaking the data down by capital cities reveals that rents having fallen over the quarter in

  • Sydney (-2.0%),
  • Melbourne (-1.1%),
  • Darwin (-1.9%),
  • Brisbane and Perth (both -0.7%)
  • Canberra (-0.2%).

Cost of renting Cost of renting Cost of renting

Despite the falling rents  the volume of rental searches has increased.

Despite the falling rents throughout the last quarter, the volume of rental searches on realestate.com.au is actually up 38.5 per cent over the quarter.

Although rental demand has eased over recent weeks it is currently 53.3 per cent higher than it was this time last year, highlighting much stronger levels of interaction with the available rental listings according to realestate.com

Rental demand steadied last week on the portal after falling for five weeks consecutive weeks, but the demand was fragmeneted.

Rental demand fell last week in Victoria (-0.2%), Western Australia (-2.1%), Tasmania (-2.0%) and Australian Capital Territory (-0.8%) with News South Wales (0.6%) and Northern Territory (0.7%) recording the largest increases.

 

Rental searches

Now is the time to take action and set yourself for the opportunities that will present themselves as the market moves on

Metropole Team

If you’re wondering what will happen to property in 2020–2021 you are not alone.

You can trust the team at Metropole to provide you with direction, guidance and results.

In challenging times like we are currently experiencing you need an advisor who takes a holistic approach to your wealth creation and that’s what you exactly what you get from the multi award winning team at Metropole.

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  1. Strategic property advice. – Allow us to build a Strategic Property Plan for you and your family.  Planning is bringing the future into the present so you can do something about it now!  This will give you direction, results and more certainty. Click here to learn more
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  4. Property Management – Our stress free property management services help you maximise your property returns. Click here to find out why our clients enjoy a vacancy rate considerably below the market average, our tenants stay an average of 3 years and our properties lease 10 days faster than the market average.


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Leanne Jopson

About

Leanne is National Director of Property Management at Metropole and a Property Professional in every sense of the word. With 20 years' experience in real estate, Leanne brings a wealth of knowledge and experience to maximise returns and minimise stress for their clients. Visit: Metropole Property Management


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