Good News For Everyone Locked Out Of The Housing Market: Rents Are Going Down
The news is less good if you live in Sydney.
In welcome news for an entire generation of Australians who are locked out of the property market and forced to spend a third of their income for the privilege of living in mouldy, broken down terraces, the cost of renting is falling at its fastest rate on record.
According to data released by CoreLogic, the biggest private aggregator of property data in the country, weekly rents across all of Australia’s capital cities fell by 0.4 percent in June 2016. That might not seem like much, but over the past year housing rents have fallen by nearly 1 percent, the largest annual fall since records began back in 1996. The bad news is that rental prices for apartments keep going up, increasing by 1.4 percent this year.
An accurate representation of renting.
But before you start celebrating and spending all your rent money on a Tidal subscription, it’s worth checking how the rental market is going in your city. While rents are collapsing in Darwin (down 16 percent) and Perth (down 9 percent) they’re still going up in Melbourne, Sydney, Canberra and Hobart. Brisbane and Adelaide recorded small decreases in rent prices.
Sydney is still the most expensive place to rent in the country, but that could be changing very soon. Some analysts are predicting rental prices in Australia’s largest, and most unaffordable, city to start falling due to an “apartment glut”. A record number of apartments are being constructed and when they start coming online, it’s expected the rental price across the city will start to drop.
The result of last week’s federal election (whenever it’s finalised) is unlikely to change much on the issue of affordable housing. The Coalition government is likely to be re-elected and they didn’t release a housing policy. Labor and the Greens support winding back negative gearing tax concessions to slow down the growth in housing prices, but they are unlikely to have enough parliamentary support to change the law.
Still, the downward trajectory of rent prices is a good thing for most young people. If we can’t own property due to government subsidies that prioritise property investors, we may as well pay slightly less money for our unrenovated, crumbling rental properties.