Data from the May CoreLogic RP Data index report shows that over the past month, residential rental rates in Australian cities have increased at their slowest pace on record.
While Sydney and Hobart have seen the strongest rental growth over the past year, this latest data also shows that rents in Perth, Darwin and Canberra have dropped by 4.5%, 5.5%
and 0.6% respectively.
Combined capital city rental rates across all Australian states increased by just 0.1% in the month of May, recorded at an average of AU$488 per week.
“Sydney stands out as seeing strong population growth which is creating more demand for accommodation in the city,” said index report author Cameron Kusher, who believes that investors are looking at capital growth rather than annual yield in Sydney and Melbourne. Kusher recommends investors look at Brisbane or Adelaide for a more balanced yield/growth return, though property values in these cities are unlikely to grow at the same rate as in Sydney or Melbourne.