Property market information: Are rent prices increasing?

By the resi financial blog team, 16 April 2015

Property market information: Are rent prices increasing?

Investing in the property market can sometimes feel like a thrilling roller coaster, filled with twists, turns and excitement. However, unlike an amusement park ride, you can control how high your housing venture climbs. A solid strategy and good research can support and inform your decisions, and makes buying a home to rent out a rewarding experience. Whatever your plan, protecting your investment includes setting a suitable rent.

The Quarterly Rental Review from CoreLogic RP Data shows that advertised rents across the combined capital cities rose 1.2 per cent over the three months to March, while nationally, they increased 1.3 per cent. CoreLogic Research Analyst and the report's author Cameron Kusher said this was an encouraging result after recent months of slower growth in the rental market, but rent levels continue to rise a lot slower than selling prices. In fact, CoreLogic's Daily House Value Index showed that, as of April 16, the aggregate price of a home across the five state capitals has risen almost 8 per cent over the year. 

Rental growth may be slow but has remained relatively consistent over the March quarter. Darwin was the only state or territory capital to see a drop in rents for detached houses over the quarter, declining 1.6 per cent, while Melbourne, Canberra and Sydney recorded increases of 1.3 per cent, 1.1 per cent 1 per cent respectively.

"Given the softer conditions recorded across the capital city rental market towards the end of 2014, rental growth over the first quarter of 2015 has been relatively strong at a capital city level," Mr Kusher said. 

Hobart experienced the largest rise for houses over the past year, blossoming 6.1 per cent. The popularity of multi-unit properties in the largest capital cities has remained apparent over the year, with unit rents climbing 2 per cent in Sydney and 1.4 per cent in Melbourne. However, they were the only two cities to see such a positive result for this type of home. 

These results bring up an interesting point. With rental growth progressing relatively slowly, you might need to think carefully about how you approach your investment. If you want to secure a piece of the property market, get in touch with a resi loan specialist to discuss their range of investment loan options.

Categories: Property Investment