Sydneysiders are paying more to rent a house in nine out of 10 suburbs than they were a year ago, as new figures reveal some locations have spiked more than 40 per cent.
Asking rents for houses surged in 89 per cent of Sydney suburbs analysed in the latest Domain Rental Report, while unit rents increased for 57 percent of suburbs.
House rents in North Manly are up 41 per cent for the year. CREDIT:OSCAR COLMAN
Houses in Elanora Heights had the largest jump of 45.7 per cent – or $400 – in the year to March 2022, reaching $1275 a week.
Double Bay, which rose 41.8 per cent to $2000 and North Manly (41.2 per cent) were second and third respectively, while Vaucluse and Malabar rose more than 36 per cent each. Only 26 suburbs saw a decrease in house rents.
The demand for unit rentals also led to significant price increases. Barangaroo recorded the strongest jump of 24.4 per cent to $1400 a week, while Point Piper was up 18.9 per cent to $1100.
Figures released this week revealed Sydney house and unit rents increased at the fastest annual rate in 13 years and eight years respectively.
Domain’s chief of research and economics Dr Nicola Powell said tenants had been chasing more affordable options.
“The tide has changed,” Powell said. “Those who are coming to the end of their lease, landlords will do that comparison, and it’s likely that the majority of tenants will see their asking rents increase.
“The cost of living and the impact on household budgets is going to be evident for renters … and we’re likely to see those others [suburbs yet to see an increase] move into positive annual growth.”
She said the recovery has been driven by fast falling vacancy rates – from almost 6 per cent at the height of pandemic down to almost 1.5 per cent, as renters compete with priced-out buyers – returning students and migrants.
Sydney tenants looking to capitalise on falling rental prices would need to consider areas in the outer suburbs like Prairiewood, 34 kilometres west of the CBD, down 10.7 per cent to $460. The biggest drop in unit rents was in South Wentworthville, 28 kilometres west of the city, down 9.1 per cent.
Moving further out is not an option for inner-west renter Zoe Davison, 23, who needs to live close to her university and work.
Davison spent weeks searching for an affordable rental with two other housemates but faced fierce competition.
After supplying extensive paperwork, including rental history, references, bank transactions and savings and offering $20 more than the asking rent for a house, Davison was finally approved.
Davison said she could not afford to live by herself in this rental market.CREDIT:RENEE NOWYTARGER
“I cannot stress enough how stressful that process was … we were accepted two days before we were going to be homeless, we would have been couch-surfing,” she said.
“The standards are not meeting the price we’re paying, it’s not good value for money. They can just get away with these things because the rental market was so in their favour.”
With a $250 budget, she said living in a share house had become a necessity rather than a choice: “There’s no way I could live by myself,” she said.
“I’m going to uni, I have a job, and I’m struggling to get by. I’m studying to be a teacher. That takes five years … you have to make so many compromises, lower your standard [of living] just to live somewhere, and you have to say thank you.”
The Australia Institute’s Centre for Future Work senior economist Alison Pennington said the pandemic housing boom increased the intensity of competition for “forever homes” and stability, widening the gap between housing haves and have-nots.
“Dual income households, borrowing more under conditions of near-zero interest rates, add in the Bank of Mum and Dad, and we saw a lot of house price increases for detached houses, in general, and that surge has displaced a large number of renters from detached houses.”
The Australian Council of Social Service (ACOSS) CEO, Dr Cassandra Goldie, said people on lower incomes were being priced out of major cities and some regional areas.
“Those relying on income support payments and unable to access social housing, have few housing choices and are often forced to live in situations that are unsuitable, unsafe, inaccessible or isolated from services and jobs,” she said.
“Rent assistance is just $73 a week for a single person and hasn’t been increased in real terms in over 20 years. Rents have increased dramatically, especially in regional Australia where they have risen by 18 per cent in just the last two years.
“How is someone on JobSeeker, on $46 a day – just $16,700 a year – supposed to pay the rent or buy a home? How is a pensioner in severe rental stress going to buy a home?
“Without major housing policy changes, this situation is likely to continue to deteriorate. The next federal government has to address the housing affordability crisis head first.”
article by smh.com.au