As 2012 came to a close, there was a clear story to be taken from the
rental data.
Through the year, two cities broke well clear of the pack: Perth and Darwin.
The Darwin unit market was the best performing rental market in the country
last year, with median weekly rents increasing a whopping 19.6 percent,
according to Australian Property Monitors. The Perth housing market came
in a close second, increasing 17.5 percent.
Brisbane came in third place a long way back, with houses and unit rents
increasing about 2.6 percent. However, yields for Brisbane houses were still
the best in the country, at 5.3 percent, in equal top place with Perth.
However, Darwin unit yields were still a clear overall winner at 6.2 percent.
Around the rest of the country, the rental markets were essentially flat, with
housing rents even falling 1.4 percent in Melbourne, and 4.0 percent in Canberra.
It's a basic supply and demand story. Rental markets in Perth and Darwin are
incredibly tight.
According to SQM Research figures, Darwin has a vacancy rate of 1.1% and
Perth a vacancy rate of just 0.7%.
This is coming on the back of rapid population growth. Perth is growing by
1,500 people a week!
And what's driving this growth: mining, of course.
It should come as no surprise that W.A, the N.T and QLD are leading the way.
These are the states benefiting most from the mining boom.
Looking ahead, this story will continue to dominate, and Perth and Darwin will
continue to grow quickly. APM are also forecasting rental price increases in
Brisbane and Sydney, but there's little to get excited about around the other capitals.
The mining boom is still the big story in 2013. The broader economy is gathering
momentum, and this will eventually give a lift to the other cities. But until then, the
best returns are still to be found around the mining states.
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