Rental property website Rent.com.au has released its report for October 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:
- Perth is no longer a tenant’s market, with demand increasing and rental availability low. Rental stock levels have dropped by more than 50% between April and October.
- Melbourne metro has recorded the opposite, with October showing a 53% increase in the number of available rentals since April 2020.
- Melbourne, Perth, Adelaide, Hobart, Darwin, and Canberra all recorded an increase in the national rental price per room (apartments and houses combined).
- Adelaide saw a reverse of its upward trend in apartment prices, with rents falling by $10/week in October, and a 2.9% change. Houses also saw a 1.2% decrease.
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|
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Price trends in October 2020
While lockdown created unprecedented pressure on Melbourne’s rental market, the recent lifting of restrictions has provided some relief – especially for tenants – as more rental stock hits the market. 53% more stock is now available to house hunters than there was in April.
Greg Bader, CEO of Rent.com.au said: “In a sign that the lifting of restrictions in Melbourne is seeing strong demand for rental properties return, October’s report showed an uplift in pricing for both apartments (up by 1.2%) and houses (up by 3.4%, or $15/week), with apartments leasing 16% faster.”
David Crombie, Chief Executive Officer of Professionals Real Estate, commented on the trends in rental availability across Australia, in particular the trends in Sydney, Melbourne and Perth metro. “Our offices are reporting strong rental demand in Perth, with many reporting zero – or close to zero – vacancies. Some are reporting vacancy rates at levels not seen for over a decade,” he said.
“We see a different result across Sydney, with high availability of stock in inner-city areas, and with a greater choice of properties, we’re seeing rent reductions in some areas. I’ve heard examples of houses where the rent has dropped by up to $100/week, compared to what the property was rented for before COVID-19.”
In other parts of Sydney, David said the rental market remains relatively healthy. “Rents in some areas have come back marginally, but nowhere near the levels of the inner-city,” he added. “Melbourne is very similar to Sydney with the outer suburbs still experiencing good demand. With the inner city most affected, available stock levels are up – this is predominantly for units because the market for houses is still good. We’re yet to see the effect of the Stage 4 lockdowns, but there was still activity in this time.”
Both Melbourne and Sydney’s city and inner-city markets were among the most affected in October, with increases in available rental listings. “Those markets are now tenant markets, due to the level of stock and reducing rents,” David said. “I think COVID-19 and the requirement for many to work from home has made them assess their needs – some tenants have taken the opportunity to move to more suitable properties than their existing rental, for similar or less rent.”
David said there also appeared to be an increase in the number of furnished properties available, which could reflect the properties that were moved from the short-term letting market to the permanent rental market.
Price per room.
Rent.com.au’s price per room metric offers another way to look at the cost of renting in Australia. Looking at the annual change from the October data, all metro capitals saw an upward trend in price per room for houses, with the most significant change in Perth, up 11.4% to $130/week. That said, the WA capital remains the cheapest for price per room on a national basis. The cost of a room in an apartment in Perth was also up year-on-year, rising 13.1% to $215/week. Areas with consistent changes for both apartments and houses included Sydney, Perth, Darwin, and Canberra.
Table 2: 12-month change in price per room (Apartments versus Houses)
|Metro area||Apartments||% change from OCT 2019||Houses||% change from Oct-19|
|Source: Rent.com.au 2020|
Table 3: Regional rents in October 2020
|State/Territory||Oct-20||% change from Sept '20|
|Source: Rent.com.au 2020|
Pushing the Northern Territory out of the game, South Australia’s regions recorded the most significant price spike in October, jumping 4.3% to $300/week.
SA was one of just two states to record any change in the regional median rent: Victoria also rose 2.9% to $350/week. All remaining states and territories were stable, month-on-month.
The highest regional rents in October 2020 were in the Northern Territory, unchanged at $450/week, closely followed by New South Wales at $410/week.
Time on market.
Table 4: Time on market in October 2020
|Metro area||APARTMENT days on market OCT 2020||% change from SEP 2020||% change from OCT 2019||HOUSES days on market OCT 2020||% change from SEP 2020||% change from OCT 2019|
|SYDNEY||30 days||4% slower||8% slower||22 days||1% slower||22% faster|
|MELBOURNE||33 days||16% faster||46% slower||22 days||7% slower||6% faster|
|BRISBANE||27 days||1% faster||21% slower||15 days||2% slower||34% faster|
|PERTH||21 days||7% faster||34% faster||16 days||6% faster||45% faster|
|ADELAIDE||21 days||1% slower||9% slower||16 days||6% slower||22% faster|
|HOBART||20 days||10% faster||26% slower||17 days||12% slower||6% slower|
|DARWIN||15 days||34% faster||49% faster||16 days||13% faster||43% faster|
|CANBERRA||22 days||1% slower||6% slower||16 days||16% faster||28% faster|
Rent.com.au’s average time on market measure is designed to provide some context to the movement in median rents across Australia.
Of all metro areas, Darwin was the one to record the most significant change to time on market, month-on-month. Apartments leased quickest in the NT capital in October, coming off the market in 15 days (34% faster). Year-on-year, the changes were similar for Darwin – apartments shifting 49% faster in the 12 months since October 2019 and 43% faster for houses.
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