Median rent prices and listing volumes have continued to rise across most major capital cities in the first three months of 2020, new data shows.
Domain's latest rental report, which covers the median rental price for houses and units across the country, has Canberra as the most expensive city to rent a house with unit rental prices also holding steady over the March quarter.
Melbourne house and unit rental prices lifted over the quarter, posting the largest growth in median rents, while Brisbane rents remained flat.
Hobart continued to have the strongest rental growth, with house rents rising 2.2 per cent over the quarter and 4.4 per cent over the year.
Australia's most expensive housing market, Sydney, saw rents rise over the quarter for the first time in three years for houses and two years for units.
Despite the quarterly lift, rents declined by 1.9 per cent in Sydney, over the year and now stand at $530 for houses and $520 for units.
The city continues to record the highest weekly asking rents for units and second most expensive for houses of the capital cities.
Domain senior analyst Nicola Powell said the trend was expected to be short-lived, following an increase in rental listings over the last two weeks of March, which would help to ease rental conditions moving forward.
Median house rent prices
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Queensland, which has seen its highest net interstate migration over the last decade, continues to lag behind other states.
Brisbane’s rental market remain flat for now with median weekly asking rents for the quarter at $410 for houses and $385 for units with tenants enjoying the longest period of stability in the city's rental history with just over five years of steady rents.
Despite this, Brisbane’s vacancy rate has been sliding marginally over the past few years indicating that the extended period of heightened rental supply is tightening.
“Travel restrictions, border closures and social distancing rules have meant tourism is virtually non-existent. This has forced many short-term rental properties to the longer-term rental market in a bid to keep investment cashflow for landlords,” Powell said.
Adelaide house and unit rents lifted to reach record highs, with unit rent growth outpacing houses.
Despite rising rents, Adelaide remains the second most affordable rental market for houses, and most affordable unit rental market on par with Perth.
Perth, which has suffered through the mining downturn, weak population growth and a flood of rental listings, enjoyed a boost with house rents up 1.4 per cent over the quarter and 2.7 per cent over the year to $375.
Median unit rent prices
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The national rental vacancy rate rose in March, rising 10 basis points to 1.8 per cent.
Sydney’s vacancy rate rose 20 basis points in March after trending down since mid-2019 with an estimated 14,528 vacant rentals at the end of March–845 more than a month ago.
Melbourne’s rental vacancy rate rose in March to 1.6 per cent due to 583 additional vacancies across the city while Brisbane now sits at 2.1 per cent.
Rental listings have jumped by a staggering 20 per cent in recent weeks with many rushing to lower the cost of living during the coronavirus crisis.
According to Domain, listing volumes have soared across a number of capital cities, with Hobart up 58 per cent, Canberra up 29 per cent, Sydney up 19 per cent, Melbourne up 18 per cent and Brisbane up 21 per cent.
The rise in new rental listings in response to the coronavirus-induced economic downturn is now likely to push the rental vacancy rate higher over the coming months.
Australia's total debt to household income is currently at a record high of 186.5 per cent, with Australian households among the most heavily indebted in the world.
Fiscal measures rolled out by the federal and state governments have served to support household income with the job keeper initiative providing many struggling with rent relief and the ability to continue paying their bills.
Domain noted the race to the rental market has been led by many who now find themselves unemployed, looking for ways to save money by moving back in with parents or partners and vacating properties.
There was also a noticeable increase in short-term rentals coming onto the full-time rental market as many Airbnb's geared towards the tourism industry now aim to reposition their offerings.