Will Melbourne/Sydney rents increase this year?

Pretty low!

 

C'mon is it really that bad (yet)? My observation tells me its biased very slightly towards landlords, but def not dire.

‘Like a buyer’s agent but for renters’: Sydneysiders seek professional help to find homes

 

Dont think rents are rising in melb much yet, certainly not in the popular middle ring suburb i'm invested in! In fact they haven't really increased since 2015, despite all the press about rising rents. Still waiting. Melb really does look far and away the best value city in Australia to rent in, particularly given the amount of jobs and career options, rent is pretty affordable particularly if you're a working couple.

 

I noticed something similar in some of the Sydney suburbs, albeit few areas rents are slightly cheaper then they were in at their peak in 2016-17.
Was bit surprised at the talks about rents dramatically rising and rental crunch etc especially in regards to Melbourne Sydney, may be market within market so who knows.

 

Hmm only anecdote, we had an average 20 year old home in south west Sydney go to market. Family home.
Had 1 open, 26 people walk through, 8 applications, and rent paid above ask on a short lease. I was very specific about the tenant too.
Across south west we've seen this has been the norm.
I don't think this market has ever been like this - would not like to be one of the 25 viewers or applicants in this market. Have seen Cbr a bit like this before at certain times of the year when there's a big influx, but not a standard SWS suburb.

 

Just curious where do you see this?
I noticed in many Sydney suburbs vacancy rates are just back to its last decade avg.

 

Not sure - just read domains monthly rental report that reports vacancies.

 

Sydney and Melbourne had massive vacancy spikes during covid. The vacancy rates blew out from low 2%'s (Melb) and mid 2%'s (Syd) to 4% (Syd) and 4.5% (Melb). At least partly explained by people fleeing the city in the great regional escape. These are city-wide averages.

Sydney just fell to 1.6% (last seen 2017) and Melb just fell to 1.9% (last seen feb 2020). Not ultra tight but certainly not soft as they were.

Individual suburbs did better and worse of course. Generally inner city did worse and outer suburbs better.

The problem is an outer suburb with family homes at certain price point are mostly very tight, whilst inner city units are soft. That family isn't likely to move into the CBD apartment just because it is available if it isn't suitable. The average statistic hides the stress of the family renting a 3 or 4 bed home who are going to suffer the most in this next stage.

Meanwhile regional vacancies nationwide fell since 2020 to incredibly tight levels. Many below 1% which is very hard to manage if you are a tenant - there are no homes to choose from and the next town is over an hour away.

National vacancy rate is 1.1% - the lowest it has been in about 15 years.

I think the rest of the nation will have growing rents with only a few exceptions. Sydney and Melbourne less dramatically but yes some growth on the horizon I would say.

 

Yes seeing this...what is interesting is this time Sydney and Melbourne rents are not rising as fast maybe 2-5% max.

But places like Wollongong it is crazy...for example my ordinary 3 bedder in Barrack Heights was bought for 241k....it was rented for 465pw unrenovated. I am renovating this now...and rent after renos is expected to be 580-600pw. Crazy!

So it is in fact popular regionals which are going nuts...

 

Very disjointed Mel market currently for rents.

My inner melb units (Kew & Mont Albert) and a large Doncaster house relet this year at rents similar to 2016/ 2017 level. Kew unit & Doncaster home both vacant for over 3 months. Had to reduce rent for the large home (5 bedder renovated and abetting a park) by $100pw below the 2017 rent.

A home in Glen Iris is on identical rent to the last lease, signed 3 yrs ago.

Frankston (& surrounds) portfolio has rents up c15% in 12 months for houses and almost zero vacancy. Apartments up 5%-10%.

QLD (Rockhampton, Cairns and Hervey Bay) through the roof in 12 months - up approx 25% in Hervey Bay, 20% in Rocky and 20% in Cairns.

Albury rents up 20% in 2 years, Bendigo is 10% up 12 months and Kalgoorlie up 15%.

So portfolio-wide, inner Mel has lagged significantly whilst everything else is up significantly.

 

All of my properties achieved healthy rental increased last week - and were all turned around very quickly after quick chat w/ each tenant.

 

I picked 6 postcodes randomly throughout Australia to look at quarterly vacancy rate trends..see attached example.

2000 = Sydney city
2122 = Eastwood, NSW
2560 = Campbelltown, NSW
3220 = Geelong, VIC
4740 = Mackay QLD
6019 = Scarborough, WA

All appear to be the lowest they have been in quite a while.

 

Confirms regionals are up big time.

Doing a build Phillip Island way for 390k.... rent on completion is expected to be $550 plus for 4x2x2.

Outer Perth building for 390-410k rents on completion expected to be 550-600pw. Crazy times.

Within the next 12 months all my rents in Geelong will be over $500pw except one.

 

Sydney' current vacancy rate seems be similar to its decade avg range of 1.5-1.7% range (barring covid period),




Sydney avg rentals also doesn't seem to be way over its peak in 2017 albeit unit rents has fallen a bit.
Avg House rents: 750@2017, 800@2022
Avg Units rents: 625@2017, 605@2022




or may be rents rises are not fully captured in data yet?

 

I picked your first postcode: 2000

Current vacancy rate of 3.4% is above its decade long avg of 3% (barring covid period)




Rents
Avg houses rents: 2030@2018, 1700@2022
Avg Unit rents: 1050@2018, 975@2022

 

If you read my post you would see I was trying to explain how inner cities did the opposite of outer suburbs and regional over recent times.

 

It not all apples for Sydney..... I reckon....rent rises will be minimal. I also reckon that rent rises in Brisbane will push people back to places like Melbourne....lets see....

The Sydney suburbs where rents are falling - realestate.com.au

 

Its interesting because if rents have increased massively in regionals and house prices too in the last year, this makes it a less financially attractive option to move regional.

There is a disconnect somewhere when regional rents in small towns are higher than inner Melb and parts of suburban Sydney.

 

Rents in Port Phillip SA3 are atrocious.

 

https://www.propertyology.com.au/next-property-boom-will-end-rental-crisis/