Brisbane rents dropped by -0.6% – APRIL 2016

Based on the CoreLogic May monthly rental review released today, while rents increased slightly by 0.1% in April, overall, capital city rental rates edged lower, falling 0.2% over the past 12 months.

Key Findings:

  • Rental rates are currently $490/week for houses and $467/week for units across combined capital cities;
  • Five of the eight capital cities saw a modest rise in rents over the past twelve months, including Sydney (1.4%), Melbourne (1.7%), Adelaide (0.5%), Hobart (1.1%) and Canberra (2.5%);
  • Perth (-8.9%) and Darwin (-12.6%) experienced large drops in rents & have collectively pulled the combined capital average lower;
  • Brisbane rents dropped by -0.6%.

2016-05-09--monthly-report-report
Research analyst Cameron Kusher said, “We anticipate that the weakness in the rental market will persist over the year and rents will continue to fall over the coming months. The annual change in rental rates continues to be at its slowest pace since before 1996.”

“At the same time last year, rental rates increased by 1.7% which indicates a sharp slowdown in rental growth over the past year.”

“Factors contributing to a slowing in rental growth include falling real wages, excess rental supply in certain areas and lower rates of population growth – all of which have impacted on demand for rental accommodation.”

“With dwelling approvals at recent record highs and construction activity set to peak over the next 24 months, accompanied by many new properties still to settle, we anticipate that the weak rental market conditions will persist with rental growth continuing to slow and, or, fall in most capital cities.”

“Based on current market conditions, landlords won’t be in a position to lift rental rates and may actually need to reduce rents in order to keep their tenants. We see renters as holding a stronger negotiation position and where they now have the potential to upgrade into higher grades of accommodation for a similar, or lower rents,” Mr Kusher said.

Canberra is the only capital city where the annual rental change is currently stronger than it was a year ago. Mr Kusher said this highlights the weakness in rental market conditions is being felt across all other capital city markets.

With rental rates increasing in some cities in April, rates in Sydney, Adelaide and Hobart are at record highs. In all remaining cities, rental rates are now below their highs with the declines recorded respectively in: -0.1% in Melbourne, -0.8% in Brisbane, -13.7% in Perth, -17.3% in Darwin and -5.4% in Canberra.

The results show that as rental changes outpace home value changes, gross rental yields have trended lower and have hit record lows of 3.3% for houses and 4.2% for units.

Mr Kusher said, “In our two largest capital cities, we’ve seen rental yields move to record lows of 3.1% for houses and 4.0% for units in Sydney and in Melbourne, rental yields are at a record low 2.9% for houses and 4.0% for units.”

“With home values continuing to grow and rental markets expected to soften further, don’t be surprised if we see a further compression of gross rental yields over the coming months,” he said.

YOUR LOCAL BRISBANE PROPERTY SALES AND MANAGEMENT SPECIALIST

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Removing the Hassle from Sales and Rentals across South East Queensland. Aim to Empower other like minded Property Investors. L J Gilland Real Estate is a prestigious boutique agency specializing in Property Investment Management Services and the Sales of Investment Properties with tenants in place. Comprised of a top performing group of handpicked specialists, our Agents proudly serve Property Investors in Queensland. Since 1996 our Agency has demonstrated a genuine enjoyment of working with people, developing long-term relationships and delivering on the promise of great service. Carlos and Linda Debello offer property investor's the confidence to sell and lease in any market. We provide comprehensive market appraisals, exclusive multimedia marketing campaigns, and knowledgeable, highly personalized counsel on all aspects of real estate. Our Property Management Team is equally considerate, offering investors with in-depth advise, well-researched rental valuations, and highly professional rental management services. http://goanimate.com/movie/0M4bvcZzgIbI?utm_source=linkshare&uid=0u6RGtWsmlVc Carlos’ direct mobiles are 0400 833 800 & 0413560808. Linda’s mobiles are 0409995578 & 0414978700 (prefer email contact for Linda). Office 07 3263 6085. http://www.ljgrealestate.com.au http://www.yellowpages.com.au/qld/aspley/lj-gilland-real-estate-pty-ltd-14091356-listing.html http://au.linkedin.com/in/lindajanedebello http://twitter.com/GillandDebello http://www.facebook.com/pages/ljgrealestate
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