Rental rates increased across the nation in the March quarter with growing demand for rental properties expected to drive even better rental returns for investors as the year progresses.
Weekly rental rates increased by 1.4 per cent in the 12 months ending March, according to RP Data, while weekly rentals in the capital cities jumped by 2.7 per cent.
“With limited purchasing activity based on concerns about affordability, we are likely to see increasing demand for rental property,” commented RP Data senior research analyst Cameron Kusher.
The national median rental price now stands at $355 and $380 for capital cities.
According to RP Data, units are offering investors the strongest rental returns with unit rents increasing at an average of 7.9 per cent over the past five years, compared to an average annual rate of 7.1 per cent for houses.
“This result reflects changing lifestyle patterns and the ongoing densification of inner city areas and subsequent increasing demand for rental units in these regions,” said Mr Kusher.
Of all capital cities Darwin offers investors the highest rental income, according to the report, with houses and units in the top end bringing in $520 and $430 per week.
Pilbara in Western Australia however currently offers investors the best rental income of all, with the median rent there sitting at a whopping $1,650 per week.