Unit rents creeping higher
UNIT rents are creeping higher and in most capital cities prices are almost as expensive as houses.
The rental market for units has outperformed that of houses during the year to September, according to Australian Property Monitors (APM).
Nationally median rents for houses fell by 0.2 per cent while unit rents rose 1.1 per cent, according to AMP’s Rental Price Series Quarterly Report.
Median rents for apartments is approaching parity with houses in most capital cities. In, Melbourne the median rent for units is $350 (houses $360), in Sydney $460 (houses $495), in Brisbane $360 (houses $370), in Perth $370 (houses $380) and in Canberra $430 (houses $465).
“Annual figures show unit rental prices have increased at a significantly greater rate in most capital cities compared to houses,” according to APM senior economist, Dr Andrew Wilson.
“This indicates increased competition from discontented first home buyers entering the rental market, particularly in late 2010 and 2011.
“Overall demand for lifestyle and affordability reasons continues to be greater than demand for more expensive and generally outer suburban houses.”
Dr Wilson says stable rates and an expected increase in buyer activity would take some pressure off apartment and townhouse rents as investors re-enter the market.
A separate property report indicates the demand for units in the nation’s major cities is likely to continue in the long term.
Research by independent think tank the Grattan Institute found that having a detached house on a block of land no longer ranks highly among Australian households.
It suggests that an ageing population coupled with the decreasing size of households are set to produce significant shifts in the mix of housing styles people want.
The key features for households chosen from a list of 55 characteristics in the survey are “the number of bedrooms”, “safety for people and property” and “near family and friends”.
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