Unit rents on the rise
The latest RP Data Quarterly Rental Report for June 2014 shows that unit rents have increased by 2.4 per cent during the first half of the year across the capital cities combined.
House rents have remained unchanged during the same period. But on an annual basis, house and unit rents across the capital cities combined have increased by 2.4 per cent.
Median rents for units in the capital cities rose by 1.2 per cent to $420 a week for the June quarter. The median rent for houses remained steady at $430 a week.
Of all the capital cities, Sydney recorded the largest increase in median weekly unit rent, up 2 per cent on the previous quarter. Unit rents in Melbourne increased by 1.4 per cent in the same period. Rents were unchanged in all the other cities, except for Canberra and Brisbane, which recorded falls of 2.5 per cent and 1.3 per cent, respectively, for the quarter.
In the 2014 calendar year to date, Hobart and Sydney both experienced the largest gains in median unit rent, with increases of 3.7 per cent and 3.1 per cent, respectively. Canberra experienced the biggest fall, with median rents declining 3.7 per cent over the 12-month period.
In the housing rental market, Sydney, Brisbane, Adelaide, Darwin and Canberra all recorded no movement in median weekly rents during the June quarter. Only Hobart (-1.5 per cent), Melbourne (-1.3 per cent) and Perth (-1.0 per cent) experienced declines in rents over the quarter.
Adelaide was the only city to experience an increase in house rents over the 2014 calendar year, with Canberra (-2.0 per cent), Hobart (-1.5 per cent) and Perth (-1.0 per cent) all experiencing decreases. The other capital cities all showed zero growth during the 12 months.
In the long term, RP Data says capital city rents have experienced only moderate growth in the past five years, with capital city unit rents up 2.8 per cent annually and capital city house rents up 2.7 per cent annually.
Among the factors it says have contributed to subdued rental growth since June 2009 are stimulus from low interest rates, and low returns on other asset classes and from savings accounts, which have enticed prospective new home owners into buying, thus easing demand for rentals.