It seems unbelievable after the year we’ve just had, but nationally, rental prices are the highest they’ve been in 13 years.
Then again, after the year we’ve just had, nothing should seem unbelievable anymore.
Just as Sydney’s red hot housing market shows signs of cooling, the rental market has begun to pick up steam for the first time since the pandemic hit. After almost two years of stagnation—and in some instances, decline—house rents in Sydney climbed to a record high of $580 per week over the September quarter, rising 5.5% or $30 in three months while increasing by up to $50 in some regions.
Sydney remains the third most expensive rental market in the country, with Canberra and Darwin coming in first and second. Recent data shows unit rents are also back on the rise for the first time since COVID hit, increasing 3.2% or $15 over the same quarter to a median of $485—though still a sizable gap of $65 from the 2018 record of $550.
Though the easing of restrictions coupled with the reopening of international borders should explain the rise, changes in the rental market began before lockdowns even lifted and despite NSW Government issued eviction moratoriums and the Residential Tenancy Support Package. Unbelievable—and yet, once again, so.
This year, the regions with the highest annual rise in median weekly asking rents for houses were the Central Coast, Eastern Suburbs and Northern Beaches, all up over 15% from last year. Meanwhile, the largest quarterly increases were in Baulkham Hills and Hawkesbury, both up 3.1%.
YoY growth in median weekly asking rents for units also increased significantly by 9% on the Central Coast, 8.8% in the outer west and Blue Mountains, and 5% on the Northern Beaches. The biggest quarterly increase in Sydney unit rents is in the inner west (4.3%), demonstrating that high density suburbs in close proximity to the CBD are returning to favour as WFH restrictions ease.
Speaking of eased restrictions, they’ll likely have a hand in rents rising further next year as international students and travellers bring back demand for rentals, along with Sydneysiders returning from their covid-inspired sea/tree changes. Add aspiring first-home buyers priced out of the property market to the mix, and that $65 gap should close in no time.
But what about all those excess units? With all the talk of supply outweighing demand, you’d think we’d be drowning in rental listings, particularly in inner city suburbs. But since February, stock has reduced significantly, and by the end of October, inner-city rental listings fell 5.1% below pre-Covid levels and 36% below advertised rental stock levels in January of this year.
All this to say that if you’re looking to rent or buy an investment property—now might be a good time to jump. Book in a call to find out about your options.
