Rental property website Rent.com.au has released its report for April 2020, based on property leasing data. The report illustrates the shift in Australian median rental property prices (both metro and regional), rental affordability (the median room price metric) and days on market.
Rent.com.au Rental Snapshot Highlights:
- As short-term rentals are forced to switch to longer-term options under the ongoing COVID-19 crisis, increases in supply and changes to the market are causing a gradual drop in prices.
- Adelaide is still the cheapest place in Australia to rent an individual room in an apartment at $160/week, despite a 3.2% price increase year-on-year.
- Darwin was the only metro capital where apartment rents did not fall in April, climbing 14.1% to $365/week.
- Melbourne (-3.5%), Hobart (-3.2%) and Canberra (-3.1%) were key contributors to the national fall in house median rent in April.
Table 1: Median rent (apartments v houses) and price per room
|Metro area||Apartments||% change||Houses||% change||Price per room||% change|
|Source: Rent.com.au 2020|
Price trends in April 2020
For anyone following the latest news, it will come as no surprise that COVID-19 continues to have varied impacts on residential housing, but the rental space is facing new challenges. Government policies have restricted short-term rental arrangements and Airbnb rentals are slowly shifting to form part of the long-term rental supply. This added supply could mean we see rents starting to fall in the coming months.
Many fully furnished rentals have hit the market. These former short-term properties will present a new problem for landlords who previously experienced high returns and now face offering their properties as permanent rentals. Further complicating this issue, a lower percentage of renters want furnished properties.
These falls are likely to be compounded by a fall in demand. As rising job losses force some tenants to negotiate rent reductions or seek alternative, cheaper accommodation, and the flow of international student numbers pauses, more properties could soon be sitting empty.
In April, the rental market saw falls in the national median rent across both apartments (down 2.2% to $440/week) and houses (down 2.7% to $435/week).
Darwin was the only metro capital where apartment rents did not fall in April, climbing 14.1% to $365/week.
New South Wales capital Sydney has overtaken Canberra as the most expensive metro area for houses. Despite a 0.1% fall in house prices, Sydney’s median rent sat at $599/week in April, passing $550/week in Canberra.
Sydney’s current asking rents are comparable to the country’s most affordable cities for apartments in March, Perth and Adelaide at $380/week.
Price per room
Rent.com.au’s price per room metric offers another way to look at the cost of renting in Australia, for people looking to share a home and save money. Considering this metric, Perth remained the cheapest place in Australia to rent an individual room in a house at $116/week, unchanged from March 2020.
The 12-month change in price per room showed Canberra to have the biggest jump in apartment room prices, down 20.6% to $250/week.
Rent.com.au chief executive officer, Greg Bader said with most reported property data developed for the property owner (i.e. dwelling price), it was important to have an individual measurement that looked at a room price breakdown.
“Our price per room metric is a different way to look at the cost of renting,” he said. “It’s a more accurate representation for people wanting to share a home with others.”
Table 2: 12-month change in price per room (Apartments versus Houses)
|Metro area||Apartments||% change from APR 2019||Houses||% change from April '19|
|Source: Rent.com.au 2020|
Regional Northern Territory was the most unaffordable across the country for the average renter in April – prices for rentals in the territory’s outlying regions were $450/week, following a 5.8% price jump.
Western Australia was the only other state to record an increase in the median rent in the regions, up 2.9% to $350/week. All other states, except for New South Wales (no change), recorded price drops in April: South Australia (down 5.2%), Victoria (down 3%), Tasmania (down 1.5%) and Queensland (down 1.3%).
Table 3: Regional rents in April 2020
|State/Territory||Apr-20||% change from March 20|
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Time on market.
Darwin apartments saw the most significant improvement in time on market in April; taking 23 days to shift on average (36% faster, month-on-month). Apartments in the NT capital were also off market 11% faster in April – now 30 days. For all property types, the most noticeable slowdown month-on-month was in Hobart, where apartments took 26% longer to lease in April, averaging 19 days to move.
Rent.com.au’s latest report showed that overall, apartments for lease experienced a general slowdown, with the biggest changes (slowest in Hobart, Brisbane and Melbourne).
Table 4: Time on market in April 2020
|Metro area||APARTMENT days on market APR 2020||% change from MAR 2020||% change from APR 2019||HOUSES days on market APR 2020||% change from MAR 2020||% change from APR 2019|
|SYDNEY||25 days||2% slower||6% faster||25 days||4% slower||9% faster|
|MELBOURNE||25 days||14% slower||25% slower||26 days||13% slower||5% slower|
|BRISBANE||24 days||25% slower||8% slower||23 days||10% slower||3% slower|
|PERTH||25 days||1% slower||14% faster||23 days||No change||21% faster|
|ADELAIDE||19 days||6% slower||3% faster||19 days||3% faster||8% faster|
|HOBART||19 days||26% slower||43% slower||21 days||15% slower||22% slower|
|DARWIN||23 days||36% faster||41% faster||30 days||11% faster||24% faster|
|CANBERRA||18 days||11% faster||2% faster||21 days||4% slower||No change|
|Source: Rent.com.au 2020|