Housing rents in Australia are rising, and rapidly in some areas, after a long period of weakness.
Weekly rental rates increased by 2% in the year to June, a noticeable acceleration from the flat annual outcomes reported less than a year ago, according to Tim Lawless, head of research at CoreLogic.
However, Lawless says some of the increases in individual capitals were far more rapid.
“The change in rental growth conditions is most noticeable in Canberra and Hobart, where rents are respectively increasing at 8.4% and 6.2% per annum,” he said in a report released on Monday.
And while those gains dwarfed those in other capital cities, Lawless said rental inflation in Australia’s largest cities, Sydney and Melbourne, are also starting to stir.
“Sydney and Melbourne rental markets have also seen a turnaround in what was previously a sluggish rental market,” he said.
“Rents in both cities are 4.5% and 4.1% higher over the past twelve months.”
Some significant increases, driven in part by strong population growth last year.
According to the ABS, Australia’s population grew by 372,000, or 1.55%, in 2016, the fastest increase in percentage terms in the past three years.
Victoria’s population grew 147,000, outpacing second-placed New South Wales at 116,400.
It’s likely that much of that increase was concentrated in the state capitals, Melbourne and Sydney, contributing to the lift in rental rates over the past year, according to Lawless.
“The growth in rents can be attributed to the ongoing significant rate of net migration into New South Wales and Victoria,” he said.
Outside of Australia’s southeastern capitals, CoreLogic said rents in Perth and Darwin, Australia’s mining capitals, fell by 8.3% and 5.4% respectively over the past 12 months.
Elsewhere those in Adelaide grew by 1.1% while rental rates in Brisbane were largely unchanged at -0.2%.