Melbourne unit rents stalled while regional markets soar
Melbourne's inner city unit market recorded the largest falls across Australia this year down -7.6 per cent over 2020, according to CoreLogic’s Rental Review for the December 2020 quarter.
Across the individual property types nationally, houses substantially outperformed units over the year, with house rents rising by 3.9% annually against a 3% reduction in unit rents.. Unit rents were down -4.6% across the combined capital city unit market.
Despite Melbourne recording the largest falls in unit rental rates over the year, Melbourne remains the third most expensive unit market of the capital cities behind Sydney and Canberra.
Melbourne came in as the third most affordable capital city to rent a house.
The area's hit hardest in Melbourne were the City and & Inner East down -13.7 per cent and -5.3 per cent. Following behind those loss leaders were the North West and Inner South, -3 per cent and -2.9 per cent respectively.
Some regions did see improvement across the wider region including with the Mornington Peninsula up 5 per cent and the Outer East up 0.6 per cent, the only two regions that didn't see a loss in values.
Rental conditions in regional markets have been outperforming capital cities with unit markets recording weak conditions across the largest capital cities.
December 2020 saw Australia’s dwelling market record the largest monthly increase in rental rates since 2010, up 0.6 per cent over the month. The 10 year record can be attributed to growth across the house market which saw a 0.9 per cent rise in rental rates over the month, more than offsetting a -0.1 per cent fall in unit rents.
Across the broad regions, regional markets were the standout performer with both house and unit rents up 1.1 per cent in December, taking house rents 2.9 per cent higher over the final quarter of 2020 and unit rents 2.6 per cent higher.
Unit rental rates across the capital cities fell -0.3 per cent over the month to be down -1.6 per cent over the December quarter. Despite the diverse performance over the year, national rents rose by 1.9 per cent annually in 2020, which was the largest annual increase across the dwelling market since mid-2018.
