Rents higher as buyers hold off

Apr 8 2011 / 3:36 am Was written by Atwell & Co. Comments Off

Renters continue to be squeezed in the hip pocket as the deteriorating outlook for home affordability pushes up demand for rental properties, a survey finds.

House rents increased in every capital city except for Sydney, Melbourne and Darwin, a report by property data collection agency RP Data found.

Rents increased by 1.4 per cent nationally and 2.7 per cent in the capital cities over the past 12 months.

“With limited purchasing activity based on concerns about affordability, we are likely to see increasing demand for rental properties,” RP Data report analyst Cameron Kusher said.

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Mr Kusher said the rise in rents came against a background of sluggish property growth and higher interest rates.

“Limited new development during 2011 is likely to add to the upwards pressure on capital city rental rates, Mr Kusher said.

“As a result, we expect capital city rental growth to revert to around five-year average levels, with inner city units and outer more affordable housing stock having the strongest prospects for rental growth,” he said.

House rents in Sydney, Melbourne and Darwin were flat in the March quarter but rose 1.4 per cent in Brisbane, 1.3 per cent in Perth and 1.5 per cent in Adelaide over the same three months, RP Data said. In Canberra house rents increased 2 per cent in the quarter, while in Hobart they rose 3 per cent.

Western Australia’s Pilbara region continued to have Australia’s most expensive rental accommodation, with median weekly advertised rents for houses recorded at $1,650 per week, the report found.

“The Pilbara region’s rental market is tight and subsequently high prices are indicative of the isolated region’s strong demand for housing, mainly from resource sector workers and the insufficient supply of rental accommodation,” RP Data said in a statement on Wednesday.

The greatest falls in rents over the March quarter were in outer Adelaide and northern Queensland – which fell by 3.4 per cent and 2.9 per cent respectively.

The strongest growth was in the Pilbara, at 8.2 per cent.

The Age

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