Australian Property News
Outlook good for landlords
Posted on Thursday, December 11 2008 at 3:26 PM
On average rental rates across Australia have risen by one third over the past three years, according to RP Data.
The company’s research director Tim Lawless says Darwin has experienced the most rapid increase in rents.
Between 2005 and 2008, weekly rental rates in the Northern Territory capital jumped by 70 per cent from $325 to $551 per week.
Meanwhile, rent for the average Sydney house has climbed by 25 per cent from $261 to $495.
The cheapest suburb in which to rent a house in Australia is Millgrove, in Melbourne, with a weekly rate of $185 per week.
The most affordable rental suburb for units is Elizabeth Vale in Adelaide, where tenants pay an average of $155 per week.
Across the capital cities vacancy rates are now at 3 per cent or less – Sydney and Melbourne both have vacancy rates of around 1 per cent, while Brisbane sits at 1.7 per cent.
The most affordable suburbs are those in the outer ring suburbs of capital cities, mostly well outside 20 km of the CBD.
Lawless says investors targeting positive cash flow properties are going to find themselves with an abundance of opportunities over the coming year.
He says while rent rises are good news for landlords, renters will suffer.
“Increasingly, renters are stuck between a rock and a hard place and it does not look as though there is an end in sight as in many cases, renters lack the funds to purchase a home; soon it will be almost equally as difficult to afford the weekly rent,” he says.
“While housing affordability for owners is now improving due to recent interest rate cuts and to a lesser extent declines in property values, for renters affordability is likely to deteriorate even further due to strong demand for rental properties and very low vacancy rates.”
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