Moving towards the Federal election
Possibly partly in light of the upcoming election, and possibly partly as a justified victim of out of control property value increases, this month the industry had a renewed focus on the realities of renting. Domain starts off with news from their latest rent report and summary of the costs of renting over both the quarter and year. The report itself contains both quarter on quarter, and year on year statistics which show that although Sydney’s (house) rental prices between December 2021 and March 2022 (QoQ) were flat, there has still been almost a 10% rise from March last year. This is stated in the report as ‘the steepest annual increase in 13 years’. Sydney’s flat QoQ result was the only outlier with every other capital showing positive increases in both QoQ and YoY for both units and houses. The largest QoQ increase was Perth (4.3%) followed by Brisbane then Hobart, and the largest YoY increase was Canberra (16.7%), then Brisbane and Perth.
The initial story makes the point that although increasing rents are good for investors,
“…they’re too often proving disastrous for tenants, cleaving a wider gulf in Australia between the haves – who own property – and the have-nots, who are forced to fork out for the higher rents.”
A case in point is the Darlington couple who purchased their first home after taking over 7 years to save up a deposit (longer than it likely took many baby boomers to completely pay off their mortgage fifty years ago). The buyer made the point that as they were buying to live in the property, a flat property value increase in the future would be a better outcome in the broader context:
“Staying flat means housing becomes more affordable for everyone in the country. I would be much happier to live in the Australia that has more affordable housing than to reap the windfall as a lucky investor.”