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Rental market update

PPG_Blog-June_image 4_rental market update

Rental vacancies across regional Victoria have remained low and continued to decline in the first three months of this year.

New REIV data shows the state’s overall vacancy rate of 2.7 per cent was down from 2.8 per cent in the final three months of last year and 3.2 per cent a year ago.
Vacancy rates were down in every part of Victoria surveyed by REIV except Ballarat and the Central Highlands, where the increase was just 0.2 per cent to 2.2 per cent – still very low in an area where there has long been a housing shortage. This is good news for investors, as they are unlikely to face long periods without rental income while properties await tenants.
Rents also continue to show growth across most types of houses and units. In the March quarter the median weekly rental for a two bedroom houses was $250, up two per cent on the previous quarter, while three bedroom houses recorded a $290 a week median rental, unchanged from the previous quarter. They both returned a gross rental yield of 5.2 per cent over the year to March 31.
The growing increase in unit and apartment living has been reflected in rents for this style of home. The interest in these types of homes has been driven by tenants looking for low-maintenance living and an affordable lifestyle.
In the March quarter the median weekly rent for a three bedroom unit in regional Victoria was $310, up 1.6 per cent on the December 2013 quarter, and the median rent for a two-bedroom unit of $236 was also slightly higher than in December.
Vacancy rates for the major centres of Geelong and Bendigo fell, with Geelong and the Barwon region down 0.2 per cent to 3.9 per cent. Bendigo, where the New Bendigo Hospital project is underway, now has a vacancy rate of just 2.1 per cent, down from 2.3 per cent.

Information courtesy of the REIV

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