Early indicators point to a cooling market
Australia’s booming property market is showing early signs of cooling as buyer enquiries drop with the conclusion of t...
New data has revealed that, surprisingly, the country’s strongest rental yields for both houses and units are outside of the big two markets of Sydney and Melbourne.
The Domain rental report for the March 2018 quarter has found that cities with the strongest rental yields for houses were Hobart and Darwin while those with the strongest unit rental yields were Canberra and Darwin.
Hobart had a 5.15 per cent rental yield increase, followed closely by Darwin at 5.06 per cent.
Canberra units had a 5.89 per cent increase in the quarter, followed by Darwin with 5.84 per cent.
Rental prices varied across the capital cities in the first quarter of the year, with most either remaining stagnant or showing minor increases.
Domain data scientist Dr Nicola Powell said that the different economic activities across the country were the reasons why each capital produced different results.
“Stricter lending standards and varied economic activity within each capital city continued to produce different market conditions over the March quarter,” Dr Powell said.
Dr Powell singled out Hobart for being the stand-out in the quarter, but all capital cities remain competitive.
“Hobart was by far the stand-out city this quarter, delivering the only double-digit annual growth for both house and unit rents. Regardless of where they fall on the affordability spectrum, tenants in most capital cities continue to face highly competitive rental markets,” Dr Powell said.
In the housing rental market, both Sydney and Brisbane houses remained stable; despite this, Brisbane delivered the third-highest gross rental yields of the capitals.
Melbourne, Hobart and housing all had growth, with both Melbourne and Darwin reaching a record high after a 1.2 per cent and 3.6 per cent increase, respectively.
Canberra and Darwin houses both declined, with a 1.9 per cent and 3.6 per cent decrease, respectively.
Despite the decline, Darwin and Canberra were on par for price and sit only behind Sydney for most expensive weekly rent.
All capital cities, bar Darwin, saw their units increase, with only Perth units remaining flat.
Having the biggest increases were Canberra with 4.7 per cent and Hobart with 2.9 per cent.
Melbourne reached a record high with a 2.5 per cent increase while Brisbane’s 1.4 per cent increase is the first increase for units in a year.
Sydney’s increase of 0.9 per cent meant that median weekly prices for units were on par with house rents and remain the most expensive of the capital cities.
Darwin units fell by 2.4 per cent, but the city was still providing the strongest rental yields in the country with 5.84 per cent.