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May Bulletin: Rental Market Update

May Bulletin: Rental Market Update

2023 marks the 35th year since Blackshaw first commenced trading – originally from very modest premises at Griffith shops. In that time, we have grown organically and sustainably into the largest network of locally positioned offices across the ACT, Queanbeyan and surrounds, to the South Coast region.

RENTAL MARKET UPDATE

It’s that time of year when we start thinking and planning our finances. As the end of the financial year approaches, perhaps take a moment to reflect on your overall strategy and consult with your accountant.

Our property management teams have been working earnestly with landlords these past few months navigating the changes to our rental market. Where are the crowds and queues we’ve come to expect at open homes? How do we pivot our rent rate without pricing ourselves out or under? As the largest network of property managers in our regions, we’ve been seeing a real shift this last quarter, and the data has our market submerged with contradictions of what is true in the climate we are in.  

The rental market remains in favour of landlords nationally but with conditions somewhat softer in the ACT and surrounds. Canberra has lost rank as the most expensive city in Australia to rent a home based on CoreLogic’s quarterly rental review, easing off 0.7% over the March quarter.

Canberra’s vacancy rate is now more than double the same time last year. It is only 0.1 percentage points off the record high seen in 2019. The number of vacant rentals rose over the month and year and is seeing almost triple the number of listings compared to this time last year. The continual rise indicates an easing of conditions for tenants. (Domain Apr2023 Vacancy Report)

National rental market comparison

According to Domain’s March Rental Report, Australia’s net overseas migration gain hit almost 304,000 new people in the 12 months to September 2022, providing a significant boost of population gain for Australia. The proportion of overseas migrant arrivals that were temporary visa holders is now sitting at 61% - a substantial driver of rental demand.

With national dwelling values falling -0.6% and national rents rising 2.5% over the three months to March, gross rental yields continued to recover throughout the quarter to 3.88% (CoreLogic Rental Review). Across the combined capitals, it is the longest stretch of continuous rental price growth as house rents rise for the eighth consecutive quarter and unit rents for the seventh (Domain March Rental Report). House rents have surged by $135 a week (or 31.4%) and unit rents by $140 (or 34.1%) since the pandemic low. Units are experiencing a solid acceleration in rental growth, and in most capital cities have grown faster than those of houses. A shift fuelled by ongoing affordability concerns is turning budget-conscious tenants towards units.

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 For any further information or queries please contact your local Blackshaw Real Estate professional. 

Blackshaw Corporate

27 Bougainville Street
Manuka ACT 2603

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