The Limits Of The Australian Rental Markets
As it stands there are serious problems with the Australian rental market. The source of the issue, at this point, is real shortage in obtainable similarities. Worse nevertheless, there is every indication that this without of open units will persist for the remainder of the year. One consequence of the shortage is that the median rent cost has increased during the March quarter to a point that it is clear there will be consistent increases during 2011.
This last point was outlined in the recently issued Australian character Monitor’s Rental Price Series Quarterly Report. It points out that the combination of fewer vacant rental similarities with 2010’s continuous rate increases has made it much harder for new renters to go into the rental market no matter where they are in Australia.
There was a rapid 2.3% increase in the cost of rentals on a national level, suggesting higher need in the capital cities. The AMP report also mentioned that national house rentals rose by 0.1% during the quarter.
Getting specific, median rent on Sydney houses increased 1% to $485. Units saw 2.3% increased to $450 a week. Canberra and Adelaide rental homes had price rises of 2.2% and 3% respectively during the quarter. The units in these and all the other capital cities increased except for Hobart and Brisbane where the complete markets for rental similarities remained unchanged.
The current need for rental units in cities like Melbourne, Canberra, and Darwin pushed up the prices on rent above the national average. The floods in Brisbane have ensured there are units and home shortages which will affect the performance of the rental market in that city.
Dr. Andrew Wilson, a senior economist for the APM, foresees substantial growth in rental prices as 2011 unfolds. Much of this growth is being fueled by increase economic activities in addition as shortages in housing and the slowdown of first home buyers in the market.
Increased need for rental units is clear when it is understood how low the vacancy rates for these types of similarities are in many inner-city areas of Australian’s major cities. This method that there is also an increasing amount of competition among possible tenants to obtain a character.
There are signs that all of this tension may ease as increased yields on rentals foster new investor interest who may want to go into the rental market. This could be a welcome relief to renters who will have more options open to them over time.
These new developments may not come in 2011 but they are likely to come online in the coming years. This method that there will be intense price hikes, especially in the cities. however, the need for rentals is not expected to abate.
Amid all of this speculation, the issue of finding affordable housing continues to cause political tensions since future developments have been modificated to compensate for the economic and housing losses due to the Queensland floods. Millions of dollars were funneled to fund the relief efforts there from the National Rental Affordability Scheme.
The future rental market develops will be determined as much by market forces and the state of the Australian mortgage markets as they will the forces of character. There is some potential that there will be a profitable rental market in the next few years. In the average time, you may have to deal with higher prices and longer waits.