Will Melbourne/Sydney rents increase this year?

With all the talk of interest rates rising and this spooking investors out of the market, curious what people's thoughts are on whether Melbourne and Sydney's rents will take-off like it has for the rest of Australia?

Inflation data confirms Australia's two-speed rental market - realestate.com.au

I know if my rents increase by 10% in Melbourne it would offset about 1.5% worth of interest rate rises.

 

In the last 10 months rent in IP have had to increase rent in line to market rate through two tenants. Rent since 10 months ago up 49%. (NSW). I need to do the same with other IP about to come off contract in April.

 

You have markets within markets in both Sydney & Melbourne. If your property is in an area with low vacancies for the type of property it is, then yes, there's a good chance the rent will rise, however if your property is not, then no, it's not likely. Rents are all about supply/demand.

 

I think you will see continued fall in rents in these markets due to oversupply

Its going to take some time before immigration comes back to these markets

Melb cheapest rents in OZ.

Certainly hurting landlords when you have 2% rental yields. Its a tenants market

 

Oversupply? In what?

Units?
Townhouses?
Villa's?
2 Bedroom Houses?
3 Bedroom Houses?
4 Bedroom Houses?

What suburbs?

St Mary's?
Bondi?
Mosman?
Kellyville?
Blacktown?
Footscray?
Frankston?
Yarra?
New housing estates on the fringes?

Are we talking old cheapies, or sprawling homes? So many variances, its an impossible question to answer.

It's one thing to say that there's oversupply of 2 bed units in Docklands. That's clear and concise. You have the exact item (2br units) and the area (Docklands). But ALL of Sydney & Melbourne? Nope.

 

4 bed house on 650m2 land Central Coast
75.8% growth last 12 months
49% growth rent last 10 months
Vacancy rate nil

 

This gives an indication on whats happening, but anyone who is interested in rents can surely google this info and if it impacts on their investments
Its not rocket science, no immigration, oversupply

Melbourne house rents at record high, but they’re still the cheapest in Australia

 

…..the poll is at 60% stay flat/decrease

 

Not surprising here, people moving to regionals

 

Agree that there are markets within markets, but I am simply referring to the total Melbourne and Sydney medians - the first table in the article I linked shows the % change in rent for the medians for capital cities and then the rest of the state. I am curious to see what the propertychat prediction is for 2022.

Melbourne and Sydney were the only 2 to go backwards between 2020-2021, with the rest of the mainland capital cities seeing an increase of at least 8%.

Yep, quite interesting

 

I will be renting in Melb later this year, I have been watching rents in inner city, houses and townhouses. Town houses dime a dozen and crazy cheap. Too much of the same stock.

Houses little more competitive but still woeful yields for investors

 

It's not just regionals that are growing. I've put rents up in both western & south western sydney in 3 & 4 bed houses.

 

I can only say for Reservoir. I noticed there are tons of 2 bedroom townhouses for rent. Less so for Preston. But I suspect this is similar across a number of suburbs that are ripe for redevelopment as the developers try to squeeze as many 2 bedroom townhouses as possible.

I have 3 bedder townhouses and houses so I am less affected but those brand new 2 bedder really dragged down the rental market.

 

Thx

 

Yeah ive never understood this, are the economics of 2 bedders that great? I see them scattered around the north and western suburbs by developers - I would think a 3rd bedder would add a lot more appeal to families. 2 bedders are only good for dinks and retirees i wouldve thought.

 

Working remotely huge

My daughter is in Melb, works from home…. The new norm for most.

Makes sense to buy in regional centres or where it is affordable.

 

TBh With the new northconnex it’s a shorter drive than some places in Sydney. Not sure would classify as regional anymore. Central Coast has been sleeping for the last 20 years. Anyone bought in 2020 at least made $300-400k. People are still sleeping in it still have bargains with good rental return.

 

I looked at Woy Woy but I moved on

That was at around $350k quite a few years back now. Damn

 

Agree that wfh is huge right now, but wouldn't most arrangements still have some office component for 1-3 days a week? My employer wants us back in the cbd 2 days a week once omicron clears, although in theory i could wfh home 100%.

Only 100% wfh would go regional, would be tough commuting from bendigo to melbourne 2 days a week

 

You would think???

However, the company has moved to much smaller premises ….and in the main they can not accommodate all the staff. She permanently works from home.

Business has reduced its overheads, a win/win

Daughter loving this arrangement.