ZOE ASKEW
By ZOE ASKEW
RENTAL prices are rising at the fastest rate since before the pandemic, increasing by two per cent nationally to reach a historically high median of $500 per week in the first quarter of 2023.
According to the PropTrack Market Insight Report, rents in regional Victoria rose five per cent in the March quarter, with the median advertised rental price up 7.7 per cent over the past year to $420 per week.
In Traralgon, the median rental price for houses is up 5.1 per cent in the past 12 months at $410 per week and 6.9 per cent for units at $310 per week.
The median rental price in Morwell has increased by 15.8 per cent in the last year, while Churchill’s median rental price has increased by 12.5 per cent in the past 12 months, with the average cost to rent a house now $347 and $360 per week, respectively.
Rental prices in Yinnar grew 13.9 per cent in the past 12 months, with the median house rent price at $410 per week, and in Yallourn North, houses are three per cent more expensive to rent than this time last year, with the average home costing $340 per week.
Median rental prices in Sale have risen 12.5 per cent in the last year, Bairnsdale’s by 12 per cent, and Heyfield’s by 33.3 per cent, with median rental prices of $450, $420 and $440, respectively.
Despite continuing increases in rental prices across the country, capital city rents far outpaced regional prices, up 13 per cent year-on-year, with Sydney, Brisbane, Adelaide, and Perth experiencing the fastest-growing rent annually of more than 10 per cent.
Median rental prices in Moe remain the same as this time last year, with the cost to rent a house in Newborough actually down 2.9 per cent at $340 per week.
According to PropTrack senior economist Paul Ryan, extremely tight conditions, in which high demand far outstrips supply, propelling rent prices upwards, are unlikely to ease anytime soon.
“As a result, we expect rental prices will continue to climb,” Mr Ryan said.
“This is particularly the case in capital cities, where rent increases have not yet eased since accelerating in early 2022. In the regions, rent growth has slowed after significant rent increases throughout the pandemic.”
According to the National Housing Finance and Investment Corporation’s State of the Nation’s Housing report, the main contributors to the housing shortage were post-pandemic population growth and ongoing rate hikes.
“NHFIC analysis shows housing affordability and supply are likely to remain challenging for some time, underscoring the need for a holistic approach to mitigate the housing pressures Australians are facing,” the agency’s chief executive Nathan Dal Bon said.
The Reserve Bank of Australia paused interest rate hikes recently, capping a record-long run of 10 consecutive raises that began in May 2022.
Despite the welcome reprieve for Australian households, relief is expected to be brief, with RBA governor Philip Lowe warning that more interest rate rises are probable, adding further pressure to the 5.7 per cent of regional Victorian households experiencing housing stress.
Today, 640,000 households nationwide are affected by housing stress, with figures projected to reach 940,000 by 2041.
Domain’s Chief of Research and Economics, Dr Nicola Powell, says significant change is needed to strike the right balance between tenants and landlords.
“No single solution can fix this rental crisis as it’s a compounding issue of the high cost of housing, insufficient investor activity, and the lack of social and affordable housing,” Dr Powell said.
“Rising investor activity is needed, the build-to-rent sector advanced, additional rental assistance provided for low-income households, more social housing and assisting tenants transition to homeowners.”
