Will Melbourne/Sydney rents increase this year?

Tenants took the $50 increase ok? Did the hike bring it up to market or just over?

 

I can say that in many parts of Brisbane, rents are rising from low $400wk to 500wk+ in the last 18 months when re-listed. That is an incredible 25% !

IP properties are getting bought that once went for low 400s, coming up at $520/wk in 8-15km zone. And they rent within a week.

If vacancies get under 1% like BNE, the other cities will also get some incredible rises too....

 

Both new tenants due to minor works. Both above market.

 

Yeah the problem with me is I have tenants that have been in all my IPs for > 4 years. They've endured the odd $5, $10, $20 increase but if I hike it by $50 they'll freak. But taking Skater's advice, I should just get on with it and (potentially) risk losing them.

 

Yep! Just go it already!

 

Rental market: It’s a landlords’ market as vacancy rates fall to 1pc nationally

Sydney vacancy rate at 1.4%, Melbourne at 1.8%

 

Yeah I'm noticing very rapid takeup of apartments now, which lagged houses for a prolonged period. It's gonna get very interesting in 2 months. Am starting to hike rents on all my properties not in a lease.

 

Melbourne was at 4.3% just 1yr ago. Huge drop since lockdowns ended and borders reopened.

 

Watch this market...it is going to surprise quite a few people...in particular apartments.

The change will be when the Qld migration starts reversing sometime in next year......

 

Jut heard from my agent that rent increases (n NSW anyway) are capped to just one every 12 months Thanks COVID!

 

Yeah, sucks, hey. All that does is give the tenants a nasty surprise every 12 months. It's much better for tenants to have 6 monthly increases when rents are surging. It's not such a shock.

 

Agree.

Next thing is we'll only be allowed to increase rent by CPI or some capped amount. If that ever came in, a lot of investors would just bail. That or CG would be the only play in town.

 

This is true in Victoria as well - lesson I've learned is put them up whenever you can

 

I have heard that talked about, to be honest. But, it takes a lot more than talking about something to make things happen.

 

They do this in certain areas of the USA if you believe that, it's called "rent control" and chunks of Manhattan have it for those lucky renters who are part of it - they can even bequeath their rent controlled apartment in their wills to their kids to take over

 

Yes rents will rise

Likely by double digit percentages

Vacancy rates are the lowest on record and we have a big influx of entries coming in and no supply to match. Investor volumes have been well below % of rental dwellings for years now, and now we’ll be paying the price with an undersupply here.

Really back of the envelope, 30% increase in rents equates to 3 rba rate rises being covered in a ‘rent or buy’ analysis. Housing rents are above double digits since 2021 already. If 2022 has a 10-15% ride then the first few rate rises will be partly negated by a changing equilibrium of housing values to reflect higher rental costs.

this will also trigger higher inflation too, rents make up a chunky part of the cpi basket. Combined with higher build costs and higher new dwelling values as a result, can be an upward ‘shock’ to inflation figures. Maybe so much so it gets stripped out in core inflation data.

 

Given we're allowed only one increase every 12 months, may pay to wait (2 or 3 months) till the rental crisis is at boiling point.

Otherwise you'll miss riding the wave during its full potential.

 

Nah! I have a long memory. I don't remember the year, but it was the boom before the last one, in Western Sydney. My rents were under $200. Every six months I was putting the rents up $20pw to try and keep up with market rates. I think I did that for 2.5-3years. It was a bonus if someone moved out, because you could do over $20 in one hit.

 

Even in Docklands! Barry Plant have just six Docklands properties to let displayed in their window - two years ago they had dozens. This graph tells the story: SQM Research - Property - Residential Vacancy Rates - 3008

 

Insane, do you remember what the vacancy rates were at this stage?