Rental Growth Slows

January 9th, 2015

Results in Perth and Darwin were adversely affected by the mining sector slowdown, with especially weak house rental results in the last quarter at -2.2 percent and -0.8 percent respectively. ; While units experienced healthier rental growth than houses for most of the year, results were somewhat weaker over the quarter. ; Hobart and Brisbane were the only two capital cities to experience an increase in unit rents over the last three months at 1.8 percent and 1.3 percent respectively, with rents falling during the quarter in all other capital cities.

With such soft results going into 2015, some property investors may be concerned about the growing discrepancy between house values and rental income. ; While rental growth is notoriously difficult to predict in the long term, Cameron Kusher is predicting subdued conditions to remain: ; “Given the recent high number of dwelling approvals and commencements coupled with the high level of purchase activity from investors, we would anticipate that the rate of rental growth will remain soft throughout 2015.”

Rental rates are not moving much at all right now, with growth almost slowing to a stop over the last three months. ; "Capital city advertised rents remained unchanged over the final quarter of 2014, with house rents steady at 0 per week and unit rents recorded at 0 per week. Across Australia, house rents increased by 1.3% to 0 per week, while unit rents were unchanged over the three months to December at 0 per week." reads the report.

Hobart remains the cheapest place to rent a house in Australia, at 3 a week. ; Adelaide comes in second at 0, followed by Melbourne at 3, Brisbane at 0, Perth at 0, Canberra at 5, Sydney at 5, and Darwin at 5. ; The cheapest place to rent a unit in Australia is also Hobart at 0, followed by Adelaide at 0, Melbourne at 0, Canberra at 0, Brisbane at 0, Perth at 0, Sydney at 5, and Darwin at 0.