Brisbane only capital with quarterly rise in unit rents: Domain
Rental prices across Australia’s capital cities largely remained flat over the September quarter with Brisbane the only city to record growth in median unit rents.
Sydney and Hobart reported a decline in unit rents, according to Domain’s Quarterly Rental Report.
Hobart was the standout performer over the year, reporting the highest annual rent growth for houses and units, followed by Canberra.
House rental yields improved annually in Sydney, Perth and Canberra.
Unit rental yields improved annually in all capital cities but Hobart.
"Availability of rental stock, investor activity and migration flows have created varied markets across the country. Looking just at the September quarter, house rents remained flat in every capital city," said Domain Senior Research Analyst, Dr Nicola Powell.
"While annually, growth has slowed relative to the year prior, primarily driven by stalling Sydney and Melbourne markets.
"Hobart continued to outperform other Australian capital cities, recording double digit annual rental growth for houses and strong growth for units. Canberra also saw substantial growth, with house and unit rents increasing 8.4% and 7.1% respectively. This growth has meant Canberra house rentals are now as expensive as Sydney.
"While unit rents in Sydney have started to decline, house rents remained at an all time high. However, if market conditions continue with increased supply, we could however see some relief for tenants."
Sydney median unit rents declined over the quarter and year, as rental supply hit an all time high.
Melbourne house and unit rental prices held steady for the quarter, slowing the pace of annual growth to an almost four-year low for houses and three-year low for units.
Brisbane was the only capital city that had unit rents increase over the quarter and year, while median house rents remained flat.
Canberra house rents remained on par with Sydney, making the two cities the most expensive for tenants. House and unit rents experienced the second strongest annual growth of all capital cities. Unit gross yields reached a record high.
Hobart was the strongest performing capital city, with a 10.8% annual increase in house rents and 9.4% increase in unit rents.
Perth house and unit rents experienced no change over the year. This was the first time in almost five years house rents did not decline annually. Unit rents have now remained flat for a year and a half.
Perth remained the most affordable city to rent a house, and shares the title with Adelaide for the most affordable unit rents.
Adelaide house and unit rents remained flat for the quarter but continued to record annual growth.
Rental Yields
Rental yields have increased nationally by 0.4% over the past 12 months to 3.76% for houses. Units also increased 1.5% over the year to 4.29%.
For investors, Hobart continued to provide the best gross rental yield for houses at 4.94%, and Darwin and Canberra provided the highest gross rental yields for units at 6.08% and 5.95% respectively.
Sydney and Melbourne continued to record the lowest gross rental yields for houses and units, although have begun to improve given the softer sales market.
