Rising rents in Melbourne and Sydney suburbs post-budget and COVID
Consensus Summary
Both articles highlight a sharp rise in rents across Melbourne and Sydney suburbs over the past year, driven by high demand, limited housing supply, and post-COVID market trends. Melbourneâs median house rent increased by $5 from March to the June quarter, with suburbs like Middle Park and Princes Hill seeing annual growth of 24.7 per cent and 17.6 per cent, respectively. Sydney experienced even steeper increases, with Abbotsfordâs house rents surging 41.3 per cent and Milperra and Monterey seeing rises of 29.4 per cent and 28.9 per cent, respectively. Unit rents also climbed significantly in both cities, with Sydneyâs Concord West and Enmore seeing 24 per cent and 19 per cent increases, respectively. The May budgetâs reforms to negative gearing and capital gains tax discounts are expected to impact investor behavior mid-next year, though current data does not yet reflect a supply drop. Both sources agree that rents have hit record highs since COVID, and concerns about investor flight are seen as exaggerated, with landlords instead adjusting rents to offset rising costs. The Age notes investors are shifting focus to higher-yield properties, while SMH compares the situation to New Zealandâs 2021 negative gearing changes, later reversed in 2023.
â Verified by 2+ sources
Key details reported by multiple sources:
- Melbourneâs median weekly asking rent for houses rose from $595 in March to $600 in the June quarter (a $5 increase).
- House rents in Melbourne suburbs rose by double digits over the past year, with Middle Park at 24.7 per cent and Princes Hill at 17.6 per cent.
- Upwey recorded a 12.3 per cent increase in house rents over the past year, with only 30 homes available for rent.
- Sydney house rents in Abbotsford rose 41.3 per cent over the last 12 months, reaching a median of $1300 per week.
- Sydney house rents in Milperra rose 29.4 per cent over the last 12 months, reaching a median of $1100 per week.
- Sydney house rents in Monterey rose 28.9 per cent over the last 12 months, reaching a median of $1225 per week.
- Sydney unit rents in Concord West rose 24 per cent over the last 12 months, reaching a median of $645 per week.
- Sydney unit rents in Enmore rose 19 per cent over the last 12 months, reaching a median of $643 per week.
- Sydney unit rents in Millers Point rose 18.2 per cent over the last 12 months, reaching a median of $1300 per week.
- Sydney unit rents in Wamberal rose 18 per cent over the last 12 months, reaching a median of $590 per week.
- Sydney unit rents in Gosford rose 16.4 per cent over the last 12 months, reaching a median of $640 per week.
- Rents in Melbourne have been hitting record highs since COVID.
- The May budget included reforms to negative gearing and capital gains tax discounts, with impacts expected mid-next year.
- There were three rate hikes this year.
Points of Difference
Details reported by only one source:
- A 31-year-old music industry professional named Harley Honeyman and his wife Romi are considering buying a home in the Dandenong Ranges due to high rental competition and limited supply.
- Melbourneâs median weekly asking rent for units remained steady at $600 from the March quarter.
- Domain chief residential economist Dr Nicola Powell noted that owner-occupier hubs like Middle Park and Princes Hill dominate annual rent growth due to high demand and limited supply.
- Investors are pivoting to houses on the urban outer edge to avoid negative gearing risks, with a focus on higher yields in city apartments at 7.45 per cent.
- Renter and Housing Union secretary Adu Hani stated that rents in Melbourne have been at record highs since COVID, and concerns about investor flight are exaggerated.
- Investors signing 12-month contracts may aim to capture potential rent growth over that period.
- It takes two or three weeks for real estate agents to prepare properties for sale, followed by three or four weeksâ time from photos to selling.
- Krista Bleakley, a 29-year-old dementia consultant, has rented for the last four years and is now looking to buy due to repeated rent increases and lack of housing security.
- Sydneyâs median house rent rose by 6.3 per cent over the last quarter alone, with Abbotsford experiencing the steepest increase at 41.3 per cent.
- Dover Heights, North Bondi, and Brighton-le-Sands saw house rent increases of 25 per cent, 22.4 per cent, and 22.4 per cent, respectively, over the last 12 months.
- South Coogee and Forest Lodge saw house rent increases of 21.9 per cent over the last 12 months.
- PRD chief economist Dr Diaswati Mardiasmo noted that new developments in Sydney are mostly units, increasing demand for houses and driving up rents.
- Mortgage advisor Enosh Tampoe compared the anticipated drop in investor properties to New Zealandâs experience when negative gearing was abolished in 2021, later reversed in 2023.
Contradictions
Conflicting information between sources:
- The Age states Melbourneâs median weekly asking rent for houses rose from $595 in March to $600 in the June quarter, while SMH does not provide a specific median rent figure for Sydney in the June quarter.
- The Age mentions a 7.45 per cent rental yield for city apartments, but SMH does not provide a comparable figure for Sydneyâs rental yields.
- The Age references a 12-month contract for investors, while SMH does not mention specific contract lengths but discusses landlords raising rents in advance of budget impacts.
Source Articles
The Melbourne suburbs where rents have risen the most
In some parts of Melbourne, households are being asked to fork out for double-digit increases compared with last year.
Sydney suburbs where rents rose more than 20 per cent in a year
Sought-after neighbourhoods have become more expensive, but those hoping to escape Sydney and commute may need to rethink.