CoreLogic’s quarterly rental review found that rent prices increased 10.2 per cent in 2022, but this slowed down to 2 per cent in the December quarter - down from 2.3 per cent in September and 3 per cent in the three months to May.
CoreLogic head of research and report author Eliza Owen said December marked the second consecutive quarter that the pace of growth slowed, and coincided with a small lift in the rental vacancy rate to 1.17 per cent in December - up from a recent low of 1.05 per cent in the previous month.
“The decline in quarterly rental growth rates observed in the December quarter was led by the capital cities where rents continued to increase but at a slightly slower rate than they have done in [the] September and June quarters,” Owen said.
“While a slowdown in the pace of rent rises could be a sign that the rental market is starting to shift, it’s not great news for tenants just yet. Rents are still rising in most capital cities and regional areas with vacancy rates low.”
Since the start of the upswing in September 2020, Australian rent values have lifted 22.2 per cent, marking the largest rental upswing on record. During the 27-month period, the median weekly rent valuation across Australian dwellings rose from $430 per week to $519.
Increase in available rentals
The small lift in the rental vacancy rate and the slowing rate of price growth could be due to several factors, Owen said.
“It is not entirely clear whether the rental market will continue inching toward a turning point, or if this is a temporary, seasonal reprieve due to higher new listings through December,” she said.
“It’s important to recognise, despite the increase in rental listings, the figures remain 13.8 per cent lower than the previous five-year average for this time of year.”
With another seasonal uplift in advertised rents expected in the next few weeks, rental growth could ease further.