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A glimmer of relief for tenants as vacancies lift marginally
5 months ago
A glimmer of relief for tenants as vacancies lift marginally
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The latest CoreLogic Home Value Index report for July 2024, combined with recent data from SQM Research, shows the property market is showing resilience and growth, but there are nuanced shifts that landlords should be aware of. Here’s a comprehensive look at the current landscape.

Rental Market Dynamics

The rental market remains tight, despite recent fluctuations. SQM Research reports a 0.5% decline in capital city advertised rents over the past 30 days, primarily driven by a 1.1% drop in Sydney and a significant 6.3% fall in Darwin rents. Despite these decreases, Adelaide saw a 2.1%rise, underscoring the variability in rental markets across different cities.

Vacancy Rates: A Glimmer of Relief

Vacancy rates have edged up slightly, offering a bit of respite for tenants. National vacancy rates rose to 1.2%, with Sydney’s rate increasing to 1.4% and Melbourne’s to 1.3%. Canberra recorded the highest vacancy rate at 1.8%, while Perth and Adelaide had the lowest at just 0.6%. The total number of rental vacancies across Australia now stands at 35,641, up from 33,177 in April. This seasonal easing might provide some relief to tenants struggling to find long-term accommodation.

Consistent National Growth

According to CoreLogic, national dwelling values rose by 0.7% in June, culminating in an 8% increase over the financial year. This translates to an average wealth boost of $59,000 per property, with the median dwelling value now standing at $794,000. This steady growth highlights the strength of the Australian property market, despite broader economic uncertainties.

Capital Cities: Mixed Results

Sydney’s property market remains robust with a 6.3% annual increase in home values, pushing the median home price to $1,170,152. However, Melbourne saw a modest annual growth of 1.3%, with its median home value at $783,205. While Sydney continues to be a strong market, Melbourne’s slower growth indicates a more cautious investment approach may be needed.

Standout Markets: Brisbane and Perth

Brisbane and Perth are leading the charge with impressive performances. Brisbane’s home values surged by 15.8% annually, reaching a median value of $859,240. Perth outpaced all other capitals with a 23.6% rise in home values, setting the median at $757,399. These cities offer significant opportunities for landlords seeking high returns, particularly in high-demand suburbs.

Regional Areas: Steady Growth

Regional markets continue to show solid growth, with combined regional values increasing by 7% annually. Western Australia’s regional areas led with a 16.6% rise over the year, while South Australia’s regional markets saw an 11.3% increase. These regions present attractive investment opportunities for landlords looking to diversify beyond capital cities.

Strategic Considerations for rental property providers

As the rental landscape evolves, landlords need to stay strategic. The slight increase in vacancy rates might offer a window for property upgrades or repositioning in the market. Investing in popular growth areas like Brisbane and Perth could yield high returns, while understanding the specific dynamics of each city’s rental market is crucial.

Gross rental yields nationally

a glimmer of relief