PHOTO: It will be a tough 12 months for landlords, experts say. Photo: iStock
Melbourne’s rental market is on the precipice of a price downturn because of the coronavirus lockdown, despite strong growth in rents across the city during the first three months of the year.
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The Domain Rent Report for the March quarter, released Thursday, shows a 2.3 per cent and 2.4 per cent quarterly increase for weekly asking rents for houses and units respectively, to record median highs of $440 and $430.
But the economic “hibernation” enforced by the government to halt the spread of the COVID-19 threatens to impact housing markets heavily for the next 12 months at least, particularly rentals, experts say.
In Melbourne, the strong growth in rents was hiding the fast-approaching difficulties that would be faced by landlords, Domain senior research analyst Nicola Powell said.
“It’s [a new high] for units and house rents are back to the high they achieved in 2018,” Dr Powell said. “The surprise is that the unit rents continue to track higher, because there has been an apartment boom in Melbourne.
“The demand has really continued to outstrip supply.”
| MEDIAN RENTAL ASKING PRICES – HOUSES | |||
| Capital City | Mar-20 | QoQ | YoY |
| Sydney | $530 | 1.00% | -1.90% |
| Melbourne | $440 | 2.30% | 0.00% |
| Brisbane | $410 | 0.00% | 0.00% |
| Adelaide | $395 | 1.30% | 1.30% |
| Perth | $375 | 1.40% | 2.70% |
| Canberra | $580 | 0.00% | 1.80% |
| Darwin | $480 | -3.00% | -4.00% |
| Hobart | $470 | 2.20% | 4.40% |
| National | $451 | 1.20% | -0.20% |
| Source: Domain Rent Report, March Quarter 2020. |
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