Where to look as ACT's sky-high rents keep rising

There were slightly more rental properties available at the end of June but Canberra’s rents remain the highest in the country for both houses and units.

The latest data from SQM Research shows there were about 60 more properties available than in May for a total of 492 and a marginally better, although still very tight, vacancy rate of 0.7 per cent, up from 0.6 per cent.

Average asking rents for houses for the month to 12 July was $719 a week, up 1.6 per cent, while units sat at nearly $500 a week, up 0.6 per cent, a fair way ahead of second-placed Sydney.

For the financial year, rents for Canberra houses leapt 16.4 per cent and units 6 per cent.

Independent’s General Manager Property Management Grace Hooper said that while the market had slowed little compared to earlier this year, properties were still renting extremely quickly.

“In winter, it is normal for the Canberra market to slow down a little and for properties to sit on the market longer. We have not seen this trend this year,” she said.

Ms Hooper said overall, the factors driving the market, such as people relocating to Canberra for work, especially across government departments, and low stock levels had not changed.

The most affordable properties are in Tuggeranong in the south and Belconnen in the north.

The average house rent in Tuggeranong was $615, with a three-bedroom property setting you back $558 a week.

For all units, the figure was $484, while a two-bedroom unit was cheaper at $432.

In Belconnen, the average house rent was about the same as Tuggeranong at $617, but a three-bedroom property was much dearer at $594.

Renting a unit in Belconnen is also more expensive than in the south at $490, and a two-bedroom is costlier still at more than $500 ($504).

The inner south and north remain the most expensive for both houses and units, but in-demand Weston Creek is not that far behind at $725 for all houses.

Inner south houses are going for nearly $1000 a week, although three-bedroom homes average $621. Units there are averaging $544, but a two-bedroom will cost about $600 a week.

In the inner north, houses are averaging $822 and units $590. A three-bedroom house will cost $712, while landlords are asking $632 for a two-bedroom unit.

Asking rents for Weston Creek units are about $500, while in the nearby Woden Valley, houses are averaging $694 for all houses and $615 for a three-bedroom house, and $510 for all units and $488 for a two-bedroom unit.

Boom region Gungahlin has the third-cheapest properties, with houses averaging $651 and $583 for a three-bedroom, and $461 for all units and $477 for two-bedroom units.

Canberra’s higher than average incomes mean renters may be able to absorb the rises, but for those outside the public service and related areas, keeping a roof over their heads is chewing up more and more of their income.

Welfare groups continue to press for more social housing to be built for low-income workers and those on fixed incomes.

ACTCOSS CEO Dr Emma Campbell told a Legislative Assembly planning inquiry last week that the ACT Government must commit to delivering the ACT Housing Strategy and that addressing the housing crisis must be a priority for the forthcoming budget.

“We have a shortfall of 3,100 social houses, with at least 1,600 people experiencing homelessness daily. For Canberrans on a low income or income support, the chances of finding an affordable private rental in the ACT are slim to none,” she said.

“We need the full, transparent and timely delivery of the ACT Housing Strategy and the delivery of all commitments in the Parliamentary and Governing Agreement, which includes 400 additional public houses and 600 affordable rental dwellings.

“This should include empowering community housing providers (CHP) to address the shortfall of affordable homes through access to affordable land, re-zoning to allow development by CHPs and rates exemptions.”

Managing Director of SQM Research Louis Christopher said vacancy rates had fallen and rents were now accelerating in our larger capital cities which may have ramifications for the consumer price index in the coming quarters.

“Meanwhile, there was some further evidence that we have reached the high point in regional occupancy, and some relief for local renters may be coming later this year, notwithstanding Sydney’s latest lockdown,” he said.

CoreLogic’s Rental Review for the June 2021 quarter also shows Canberra leading the nation with a house typically costing $668 a week to rent and $521 for a unit.

Its latest figures show national rental rates are 6.6 per cent higher over the year – the highest annual growth in dwelling rents since January 2009.

CoreLogic’s national rent index recorded a 2.1 per cent rise in the three months to June 2021, down on the 3.2 per cent rise over the March quarter.

National gross rental yields were 3.41 per cent in the June quarter, down from 3.55 per cent over the March quarter and 3.73 per cent a year earlier as dwelling values outperform rental growth.

Regional rents continued to outpace capital city rents, rising by 2.7 per cent in Q2 compared to a 1.9 per cent rise in capital city rents, both down quarter-on-quarter.

Despite the easing in growth in recent months, regional Australia’s annual rental growth hit 11.3 per cent in June 2021. This is the highest annual growth result since the CoreLogic rental index began in 2005.

Original Article published by Ian Bushnell on The RiotACT.