Housing rents rising at fastest rate since 2007, units continue to suffer

author-avatar By on April 27, 2021
Housing rents rising at fastest rate since 2007, units continue to suffer

National rental rates rose 3.2% in the March 2021 quarter according to CoreLogic, the largest quarterly increase in almost 14 years.

Regional areas drove much of the growth, with rents rising 4.1% across the combined regional markets compared to capital city growth of 2.9%. 

Regional unit and house rents were up 4.8% and 4.0% in the quarter respectively, while capital city unit and house rents were up 2.0% and 3.3% each. 

Houses and units in Darwin showed the strongest growth in rental rates over the quarter, with houses rising 8.2% and units rising 7.0%. 


Buying a home or looking to refinance? The table below features home loans with some of the lowest interest rates on the market for owner occupiers. 

Base criteria of: a $400,000 loan amount, variable, fixed, principal and interest (P&I) home loans with an LVR (loan-to-value) ratio of at least 80%. If products listed have an LVR <80%, they will be clearly identified in the product name along with the specific LVR. The product and rate must be clearly published on the Product Provider’s web site. Monthly repayments were calculated based on the selected products’ advertised rates, applied to a $400,000 loan with a 30-year loan term.


CoreLogic’s Research Director Tim Lawless said the strong growth hid the massive diversity in rental conditions across the country. 

"At one end of the spectrum we have Perth and Darwin where annual rental growth is well into double digits and accelerating," Mr Lawless said.

"At the other end is Melbourne and Sydney where rents are down over the year." 

Rental affordability has shrunk in Canberra, with the ACT capital currently the most expensive city to rent a house or unit at $612 per week and $513 per week, respectively. 

National gross rental yields were recorded at 3.55%, down from 3.71% over the December quarter and 3.76% a year earlier as dwelling values outperform rental growth.

Melbourne recorded the weakest growth in rents in the March quarter, with house rents up 1.6%, while unit rents were steady. 

Mr Lawless said Sydney and Melbourne's rental markets were suffering as a result of closed international markets in areas already challenged by high supply.

"Melbourne unit rents have fallen by -8.2% over the year and Sydney unit rents are -4.9% lower," he said.

“Some inner city precincts of Melbourne have seen unit rents fall by more than -20% over the past 12 months.

"Prospects for a material improvement in rental conditions across these inner city high density precincts are largely dependent on a return of tenancy demand from international students and visitors, who were previously a key component of rental demand." 

What capital city suburbs have the highest rental yield? 

The CoreLogic Rental Review for the March 2021 quarter revealed the highest yielding suburb for each capital city. You can see a breakdown for each capital in the tables below:

Sydney

Suburb

Region

Property type

Gross rental yield

Median rent

Millers Point

Sydney - City and Inner South

Houses

7.5%

$1,023

Gorokan

Central Coast

Units

5.0%

$383

North Gosford

Central Coast 

Units

4.9%

$450

West Gosford

Central Coast

Units

4.9%

$455

Gosford

Central Coast 

Units 

4.9%

$449

Carramar 

Sydney - Parramatta

Units

4.8%

$313

Warwick Farm

Sydney - South West

Units

4.8%

$334

Mount Druitt

Sydney - Blacktown

Units

4.7%

$357

Liverpool

Sydney - South West

Units

4.7%

$341

Point Frederick

Central Coast

Units

4.7%

$461

Source: CoreLogic 

Melbourne

Suburb

Region

Property type

Gross rental yield

Median rent 

Carlton

Melbourne - Inner

Units

5.1%

$378

Melton

Melbourne - West

Units

4.9%

$314

Roxburgh Park

Melbourne - North West

Units

4.9%

$372

Wallan

Melbourne - North East

Units

4.8%

$339

Travancore

Melbourne - Inner

Units

4.8%

$363

Melton South

Melbourne - West

Units

4.8%

$319

Harkness

Melbourne - West

Units

4.8%

$326

Hastings

Mornington Peninsula 

Units

4.7%

$385

Craigieburn

Melbourne - North West

Units

4.7%

$359

Truganina

Melbourne - West

Units

4.7%

$360

Source: CoreLogic 

Brisbane

Suburb

Region

Property type

Gross rental yield

Median rent

Waterford West

Logan - Beaudesert

Units

8.8%

$303

Woodridge

Logan - Beaudesert

Units

8.6%

$281

Logan Central

Logan - Beaudesert

Units

8.3%

$272

Slacks Creek

Logan - Beaudesert

Units

8.2%

$302

Kingston

Logan - Beaudesert

Units

7.6%

$331

Browns Plains 

Logan - Beaudesert

Units

7.5%

$351

Booval 

Ipswich 

Units

7.4%

$274

Loganlea 

Logan - Beaudesert

Units

7.4%

$330

Eagleby

Logan - Beaudesert

Units

7.2%

$315

Mount Warren Park

Logan - Beaudesert

Units

7.1%

$292

Source: CoreLogic

Adelaide

Suburb

Region

Property type

Gross rental yield

Median rent

Elizabeth North

Adelaide - North

Houses

7.8%

$291

Elizabeth South

Adelaide - North

Houses

7.5%

$296

Elizabeth Downs

Adelaide - North

Houses

7.3%

$301

Davoren Park

Adelaide - North

Houses

7.3%

$291

Salisbury

Adelaide - North

Units

7.3%

$290

Elizabeth Grove

Adelaide - North

Houses

7.2%

$301

Smithfield

Adelaide - North

Houses

6.8%

$318

Elizabeth Park

Adelaide - North

Houses

6.7%

$310

Klemzig

Adelaide - North

Units

6.7%

$315

Salisbury East

Adelaide - North

Units 

6.7%

$290

Source: CoreLogic

Perth

Suburb

Region

Property type

Gross rental yield

Median rent

Orelia

Perth - South West

Units

8.9%

$239

Kelmscott

Perth - South East 

Units

7.9%

$294

Armadale

Perth - South East 

Units

7.7%

$293

Gosnells

Perth - South East 

Units

7.3%

$308

Queens Park

Perth - South East 

Units

7.2%

$362

Shoalwater

Perth - South West

Units

7.2%

$283

Cloverdale

Perth - South East 

Units

7.0%

$382

East Cannington

Perth - South East 

Units

7.0%

$380

Cannington

Perth - South East 

Units

7.0%

$374

Success

Perth - South West

Units

7.0%

$357

Source: CoreLogic

Darwin

Suburb

Region

Property type

Gross rental yield

Median rent

Parap

Darwin

Units

8.%

$457

Bakewell

Darwin

Units

8.3%

$367

Woolner

Darwin

Units

7.8%

$506

Darwin

Darwin

Units

7.8%

$523

Johnston

Darwin

Units

7.7%

$421

Rosebery

Darwin

Units

7.7%

$419

Driver

Darwin

Units

7.6%

$384

Nightcliff

Darwin

Units

7.5%

$390

Millner

Darwin

Units

7.2%

$370

Bayview

Darwin

Units

7.0%

$580

Source: CoreLogic

Canberra

Suburb

Region

Property type

Gross rental yield

Median rent

Curtin

ACT

Units

6.7%

$408

Lyons

ACT

Units

6.5%

$450

Gungahlin

ACT

Units

6.4%

$473

Wright

ACT

Units

6.1%

$505

Phillip

ACT

Units

6.1%

$472

Franklin

ACT

Units

6.1%

$479

Braddon

ACT

Units

6.0%

$544

Belconnen

ACT

Units

5.9%

$474

Crace

ACT

Units

5.9%

$488

Harrison 

ACT

Units

5.9%

$482

Source: CoreLogic


Photo by Nao Takabayashi on Unsplash

Disclaimers

The entire market was not considered in selecting the above products. Rather, a cut-down portion of the market has been considered which includes retail products from at least the big four banks, the top 10 customer-owned institutions and Australia’s larger non-banks:

  • The big four banks are: ANZ, CBA, NAB and Westpac
  • The top 10 customer-owned Institutions are the ten largest mutual banks, credit unions and building societies in Australia, ranked by assets under management in November 2020. They are (in descending order): Credit Union Australia, Newcastle Permanent, Heritage Bank, Peoples’ Choice Credit Union, Teachers Mutual Bank, Greater Bank, IMB Bank, Beyond Bank, Bank Australia and P&N Bank.
  • The larger non-bank lenders are those who (in 2020) has more than $9 billion in Australian funded loans and advances. These groups are: Resimac, Pepper, Liberty and Firstmac.
  • If you click on a product link and you are referred to a Product or Service Provider’s web page, it is highly likely that a commercial relationship exists between that Product or Service Provider and Savings.com.au

Some providers' products may not be available in all states. To be considered, the product and rate must be clearly published on the product provider's web site.

In the interests of full disclosure, Savings.com.au, Performance Drive and Loans.com.au are part of the Firstmac Group. To read about how Savings.com.au manages potential conflicts of interest, along with how we get paid, please click through onto the web site links.

*Comparison rate is based on a loan of $150,000 over a term of 25 years. Please note the comparison rate only applies to the examples given. Different loan amounts and terms will result in different comparison rates. Costs such as redraw fees and costs savings, such as fee waivers, are not included in the comparison rate but may influence the cost of the loan.

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Alex joined Savings.com.au in 2019. He is passionate about providing Australians with the information and tools needed to make them financially stable for their futures.

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