13 November 2019

Squeeze is on with rents rising again in a tightening market

| Ian Bushnell
Join the conversation
Rents are on the rise again

There has been strong demand for rental houses in Canberra. Photos: File.

Canberra’s rents are on the rise again, particularly for houses which had the nation’s highest monthly increase in October.

SQM Research said asking rents for houses surged 4.5 per cent to $643 a week to 12 November, compared with $614 a month ago when rents actually fell 1.4 per cent.

Asking rents for units also went up by 2 per cent to $471 a week, compared with $462. This comes on top of a 4.4 per cent rise a month earlier.

Over the 12 months to 12 November, asking rents for houses in the national capital rose 0.7 per cent, while demand for units saw rents go up a solid 5 per cent, bucking the national trend.

While the vacancy rate has improved since this time last year when it was a very difficult 0.6 per cent with only 387 vacancies, it remains a tight market with a vacancy rate of 1 per cent and 647 vacancies, down from the September figure of 668 vacancies.

Unit rents have risen 5 per cent in the year to November

Unit rents have risen 5 per cent over the year to 12 November.

The market has tightened since winter when the June vacancy rate was 1.3 per cent with 847 properties. Rents at 12 July were $624 and $461 a week and dipped to $604 and $459 two months later. But they are now rebounding, with tenants now facing fewer properties to choose from and having to fork out more not just in rent but bond as well.

Canberra rents for both houses and units remain only second to Sydney, with demand fed by population growth, a strong jobs market and declining home ownership.

The Tenants’ Union says there has been a 140 per cent increase in the rental market over the last decade, with 143,000 people now in rented accommodation in the ACT.

Nationally, vacancy rates were steady at 2.1 per cent. Hobart was the lowest at 0.5 per cent, and Sydney and Darwin the highest at 3.1 per cent.

Capital city asking rents increased 0.9 per cent for houses but remained steady for units at $549 and $435 respectively. But over the 12 months, asking rents declined 0.7 per cent for both houses and units.

Sydney rents rose over the month, 1.5 per cent for houses and 0.2 per cent for units, but the harbour city is still recording rent falls of over 4.0 per cent year on year.

Join the conversation

All Comments
  • All Comments
  • Website Comments

Of $500 pw in rental in inner south-
$145 pw in Act taxes/rates
$200 pw federal taxes
$20 pw landlord insurance
What a great return……not.
Get rid of the land tax and I will drop the rent $145 pw making it much more affordable. Only an idiot would blame landlords for the rents in Canberra.

Rates and land tax account for over $100 dollars per week of a pretty average rental property.

The outer suburban house rental properties to lower income tenants are likely years beyond getting any tax advantage through depreciation and probably not big loans to gain from the recent interest rate reductions.

This would suggest to me that a decent proportion of the high rental increases in Canberra houses are due to ‘under supply of rental properties’ and the ACT Government property tax increases.

When are renters going to realise that a vote for ACT Labor means a vote for 7-11% yearly rises in rates, which must and will result in higher yearly rents. ACT Labor is reducing the standard of living for everyone in Canberra, except for their wealthy property developer apartment building mates. In every respect ACT Labor has mutated into a party for the elite few.

As a former owner of two rental properties in Canberra, the cost of rates and land tax amounted close to half the annual rent…..just not worth it anymore. Sold both and put money into super because was not prepared to double the rent to make it worth our while. And would have somehow had to get rid of the tenant so as to have been able to increase the rent a sufficient amount just to get back to the margin before the increases.

Gee, what a surprise! I must be psychic, because I could swear I said rents will rise along with landlords insurance, which has shot up dramatically in the ACT after the new laws allowing pets and modifications. Between that and ACT Labor with their rate rise scam, it’s going to get a lot worse. Hilarious.

Daily Digest

Want the best Canberra news delivered daily? Every day we package the most popular Riotact stories and send them straight to your inbox. Sign-up now for trusted local news that will never be behind a paywall.

By submitting your email address you are agreeing to Region Group's terms and conditions and privacy policy.