Sydney Rental Update: House rents hit a new record high
- Haynes Wileman
- Nov 3, 2021
- 2 min read
The days of negotiating lower rents look to have passed as rents begin to rise as Sydney’s rental market turns a corner according to the Domain Rental Market Report.
It’s clear that tenants are willing to pay a premium for space, as house rents leap to a new high and rise at a faster pace for rentals with more bedrooms.
Sydney’s vacancy rate has dropped below pre-pandemic levels – the lowest since late-2018 – resulting in reduced rental choice and providing grounds for landlords to raise asking rents.
It is playing out across rentals on Domain, as more landlords opt to hike rents during the advertising campaign, which points to further increases on the horizon.
With the prospect of international borders reopening, tenants could be in a vulnerable position, facing increased competition that could push rents even higher.
Particularly as soaring house prices have become a barrier for tenants to purchase, keeping them renting for longer.
However, investors have been enticed back to the property market by capital growth and improved rental conditions – investment home loan values recently reached the highest since 2017 – which will boost supply and should help contain rent growth.
House rents increased over the quarter for the first time in a year. They are now at a new record high of $580 a week, jumping $30 over the September quarter.
Unit rents increased over the quarter for the first time in a year-and-a-half, by $15. However, they remain $65 lower than the mid-2018 record high, at $485.
It is the strongest quarterly gain since 2008 for houses and 2017 for units.
This marks a stark turnaround in declining unit rents and stability for house rents.
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