Sydney residential rents have dropped for the first time in 12 years, meaning the harbourside city is no longer Australia’s most expensive city.
That title now goes to Canberra, where the median house rent is $560 per week to Sydney’s $540 per week, according to the latest Domain Rental Report.
And Sydney’s relative affordability isn’t likely to abate soon.
Domain senior research analyst Nicola Powell said the pipeline of apartment projects set to enter the Sydney market should keep rents in control for a bit longer.
“Tenants will find greater bargaining power as rising supply keeps pressure on rents, providing strong grounds to negotiate lease terms. Landlords will be keen to retain good tenants as leases expire, with incentives and rental discounts a realistic prospect,” she said.
Break it down
This is the median weekly house rate in capital cities across the country, as of the December 2018 quarter:
Perth has seen the biggest growth in rental rates, suggesting the western capital could be heading for a turnaround. Fewer rental listings, slowing construction of new apartments and population growth in 2018 are largely to thank for this.
Melbourne renters have been hit with a record rate, with the median asking rate now $440. Those living in the inner south of Melbourne are fronting up an average $650 a week for rent.
And while the pace of growth has slowed since last year, no regions saw an overall drop in weekly prices.
Canberra has its high-earning population to thank for its skyrocketing rents, Domain said.
The current rates are propped up by the Mr Fluffy asbestos removal scheme which has forced residents into rental properties while they build new homes.
And Australians are also flocking to the city thanks to job prospects and higher salaries.
Up in Queensland, Brisbane has seen an increase in rental rates for the first time in nearly three years, up from $400 to $410.
“The Brisbane market is slowly turning to favour landlords as underlying demand begins to absorb advertised rental supply,” Powell said.
Hobart also saw a sizeable increase — 2.40 per cent — in median rents. Renters in the tourism hub are now paying a median $420 a week in rent.
This city also has the unenviable title of being the worst city for low-income households to rent in.
The latest Rental Affordability Index, released by National Shelter, Community Sector Banking, the Brotherhood of St Laurence and consulting group, SGS Economics & Planning, in November last year found an average income household in Tasmania is now paying 30 per cent of income on rent.
But Hobart isn’t alone in this.
The rental landscape may be shifting, but rental stress is a problem in all major Australian cities.
“Looking beneath the headline figures, rental stress is affecting the majority of very low-income households in Australia. Pensioners and single parents are hit particularly hard,” the CEO of Community Sector Banking, Andrew Cairns said.
“The situation facing the nation’s renters remains poor with little or no improvement for low and moderate income renters.”
Make your money work with Yahoo Finance’s daily newsletter. Sign up here and stay on top of the latest money, news and tech news.