RUN Property, which manages 18,000 properties throughout Melbourne, Sydney and Brisbane, said rents have increased by up to $60 a week in the nation’s hottest rental suburbs. A full list of suburbs is attached.
RUN Property CEO Rob Farmer said rising rents would boost the confidence of investors and encourage more to buy, especially during the property market’s quieter winter months.
“Rental growth has been strong and consistent over the past 18 months, so it surprises me that more investors are not taking advantage of the dip in sales activity to secure their next bargain investment,†Mr Farmer said.
“Many properties are being re-let during tenants’ vacating periods, so they never actually become vacant.
“A good property manager will advertise the property for rent as soon as the existing tenant gives notice so that the landlord does not miss any income,†Mr Farmer said.
Demand for rental properties is highest in inner city suburbs. In North Melbourne, a one-bedroom apartment advertised at $350 a week – up $30 a week from the previous tenancy – attracted 25 groups to an inspection with several applying to rent it, Mr Farmer said.
In Sydney’s CBD and Darlinghurst, properties under $600 a week were renting like hot cakes, he said.
Many tenants were “staying put†because research continued to show that rent increases are greatest when tenants move out and the property is advertised for lease, Mr Farmer said.
RUN’s Quarterly Rent Report shows that Sydney’s Neutral Bay was the strongest performing suburb in Australia, where rents for new tenancies jumped by more than 12 per cent in the June quarter compared with the same time last year.
Glebe, Kogarah, Randwick and Potts Point all recorded rent rises of at least 11 per cent.
Sydney’s average rent increase when new tenants moved in was 7.8 per cent, taking the average weekly rent to $534.
In Melbourne, Armadale, Glen Iris and Kew were the star performers, with rent increases of at least 10 per cent, followed by Fitzroy, Essendon, Fairfield, Brunswick and Moonee Ponds which all recorded rent rises of 9 per cent or more.
Melbourne’s average rent increase for new tenancies over the past year was 6.3 per cent, up to $378 a week.
In Brisbane, Nundah recorded the greatest rent increase, of 5.9 per cent, followed closely by Clayfield, St Lucia and Logan Central, which all had increases of at least 5 per cent.
Brisbane’s average rent increase was 3.1 per cent to $333 a week.
The figures relate only to new tenancies (when one tenant moves out and another moves in) not existing leases that have been renewed with the same tenants. The figures are averages so not every property in each suburb will be affected equally.
RUN Property is Australia’s largest metropolitan property agency which manages properties valued at more than $10 billion in NSW, Victoria and Queensland.
