Saturday, January 28, 2023
HomeNewsSydney and Gold Coast suburbs where renters could pay $5200 more a...

Sydney and Gold Coast suburbs where renters could pay $5200 more a year

- Advertisement -

As rental prices rise and stock remains tight across the country, landlords in pockets of Sydney and the Gold Coast look set to gain at least $100 a week or $5200 a year in additional rental income.

The forecast by Suburbtrends for the Australian Financial Review found units in Sydney’s Hillsdale, Banksmeadow and Eastlakes suburbs, and houses in Yowie Bay, Port Hacking and Woodpark were likely to deliver at least $100 extra rent a week or more in the next 12 months.

On the Gold Coast it is Burleigh Heads, Merrimac, Varsity Lakes, Ormeau, Oxenford, Upper Coomera, Pimpama and Hope Island that are expected to see rents rise by at least $100 a week.

The Suburbtrends forecast took into account the vacancy rate level of 1.2 per cent or lower, rising rents and affordability levels that can sustain a $100 weekly increase without exceeding 45 per cent of income, the publication reported.

“The supply of rentals in the coming 12 months will fall well below what is required to keep rents from rising,” Kent Lardner, founder of Suburbtrends, told AFR.

“One variable that can’t be ignored is affordability. As rents rise above 30 per cent of household income, they become unaffordable for tenants.

“What we can see emerging across the country is households being forced out of rentals when the cost of living becomes too much, which could potentially trigger a rise in vacancy rates in those areas.”

Australia’s rental affordability crisis

The annual Rental Affordability Index released this week showed every capital city nationwide was experiencing a decline in rental affordability.

The RAI found 30 per cent or more of a person’s income was generally spent on rent.

The report’s lead author Ellen Witte said this was extremely taxing for people on single income budgets, including single parents and pensioners.

“The situation is particularly bleak because in the past low income households if needed to could still move to the regions, but often far away from jobs so it’s not really a solution,” Ms Witte told NCA NewsWire.

“Vacancy rates for rental housing have dropped so sharply everywhere and is a key indicator for where prices go if they can see rates are low, they’re generally below 1 per cent.”

Ms Witte said rental stress effects many people’s day to day lives because they find themselves having insufficient funds to pay for other primary needs such as food, medicine, transport and heating.

The report found Brisbane is considered moderately unaffordable for the first time, with an 11 per cent decrease in RAI score over the past year – the largest decline of any capital city.

Ms Witte said Brisbane’s decline in affordability stems from a “few compounding reasons”.

“Before the pandemic Brisbane was already getting more and more affordable,” Ms Witte said.

“We found in regional Queensland affordability dropped so rapidly because people were moving out to the regions especially due to the lockdowns.

“Now the economy is open again we’re seeing this issue getting worse and worse.”

The report found people living in both capital cities and regional areas were struggling to find affordable rentals, as rents are escalating faster than incomes across the country.

Low vacancy rates, interstate migration and global supply chain issues were also contributing to increased rents.

Read related topics:Sydney

Story Credit: news.com.au

RELATED ARTICLES
- Advertisment -

Most Popular