Melbourne suburbs where rents have dropped over past five years
In March 2009, the median advertised rent for a house in Melbourne was $379 per week compared to $442 this year.
This has equated to a rise of 16.6% over five years. Surprisingly there are a number of suburbs where renters have not faced comparable rises and there are even some suburbs where rents have actually dropped.
Three of the four suburbs where rents have fallen are growth suburbs; Doreen, Mernda and Sandhurst. These suburbs are unique cases as the supply of homes is very strong resulting in distortion in the data compared to more established areas. In this case it has resulted in reductions in the advertised rent.
Advertised rents in Doreen have dropped by 6.4% over five years, similar to nearby Mernda which recorded a fall of 5.9%. Sandhurst rents dropped by 2.6%.
Rents have also fallen in Ormond and barely changed in Toorak; both suburbs have comparatively expensive houses and this highlights a trend of poor growth in rents in expensive suburbs.
With very low yields in the more expensive suburbs investors are more motivated by the strong capital growth that can be found and renters in this price bracket are clearly in a very different market to the majority of renters in Melbourne.
Other similar suburbs in the top 20 for low rental growth are Canterbury, Wonga Park, Caulfield, Ashburton and Hawthorn East.
This highlights that by targeting certain areas renters can find homes where rents do not continually rise.
Suburb | Change in advertised rents in five years - Houses |
-6.4% | |
-5.9% | |
-2.6% | |
-2.0% | |
0.3% | |
0.5% | |
0.9% | |
1.7% | |
1.8% | |
2.6% | |
2.7% | |
3.4% | |
3.6% | |
4.2% | |
4.2% | |
4.5% |
Photo courtesy of Hai Linh Truong/Flickr.