Knowledge Centre

Rental market conditions strongly favour investors

28/10/2022

Rental market conditions strongly favour investors

New analysis has revealed two big reasons why rents, which are already rising steeply, are set to continue increasing.

First, the number of properties listed for rent is much lower than pre-pandemic, in both capital cities and regional areas, according to PropTrack economist Angus Moore. So supply has fallen.

Second, Australian Bureau of Statistics data show a significant increase in migrant and foreign student numbers. That means demand is rising.

"Extra demand from returning migration amid tight housing availability will contribute to the ongoing rapid advertised rent price growth we are seeing," he said.

Overseas arrivals have started to recover
Number of Monthly Active for Rent Listings

"We’re already seeing signs consistent with that dynamic. Rents are growing especially quickly in areas that recent migrants typically move to – these are mostly inner-city areas, often near major universities."

Mr Moore said "rents are likely to continue growing briskly" in the foreseeable future.

"Vacancy rates are low across much of the country and, with population growth returning, rental demand shows little sign of tempering."