Mining Slump Drags Down Rental Market in Perth, Darwin

Tuesday, February 9th, 2016
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Rents have risen in Sydney, Melbourne and Canberra, but not enough to stop slumping markets in Perth and Darwin from slowing growth over the past year to zero.

Median rents in January, averaged across the state and territory capitals, were the same as January 2015, according to firm CoreLogic RP Data.

“A combination of factors is affecting the national rental market,” research analyst Cameron Kusher said.

“Among these are a higher level of rental stock resulting in greater options for renters, a slowdown in population growth, higher than normal investment activity and stagnant wage growth.”

The changes in rents have not been spread evenly.

Over the year to January, there were rises of 1.4 per cent in Sydney, 2.1 per cent in Melbourne, and 1.8 per cent in Canberra.

Hobart landlords eked out a tiny gain of 0.1 per cent, while rents fell by 0.7 per cent in Brisbane and 0.4 per cent in Adelaide.

But the winding down of the mining investment boom has left its mark in Perth, where rents fell by 8.6 per cent through the year, and in Darwin, where the fall was even larger at 13.4 per cent.

This is the first time the annual pace has slowed to zero since CoreLogic RP Data began collecting national rental data in 1996.

The Australian Bureau of Statistics index of capital city rents used in the consumer price index tells the same story.

The lowest annual growth recorded in the ABS series, which goes all the way back to 1972, was 0.4 per cent in 1993.

In other data released on Monday, CoreLogic RP Data said housing prices had risen last week in the mainland state capitals except Perth, which was also the only centre recording an annual price fall, of 4.8 per cent.

Melbourne recorded the fasted growth, 11.0 per cent, with Sydney a close second at 10.2 per cent.

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