Property investors in New South Wales’ Casuarina have the biggest potential to increase rents given its tight market.
A new report from Well Home Loans identified 20 suburbs where it is almost impossible for renters to find a rental property due to the shortage of vacant properties that continues to push up rents.
The report found that over the past 12 months, weekly rents for houses in Casuarina went up by $205.
Interestingly, the suburb had at most one vacant property over the period.
Next to Casuarina is Henley Beach South in South Australia, where rents have increased by $175 over the past year.
The number of vacant rental properties in Henley Beach South did not exceed one over the period.
Queensland’s Pelican Waters ranked third in the list in terms of rental gains — over the year, weekly rents jumped by $170.
There was a maximum of two vacant rental properties in Pelican Waters over the past 12 months.
Suburbs with tightest rental supply:
|
State |
Suburb |
Vacant Properties (houses and units) |
Weekly rent increase ($ - houses only) |
|
NSW |
Casuarina |
1 |
205 |
|
SA |
Henley Beach South |
1 |
175 |
|
QLD |
Pelican Waters |
2 |
170 |
|
QLD |
Maleny |
1 |
150 |
|
QLD |
Bilinga |
1 |
145 |
|
NSW |
Swansea |
1 |
140 |
|
VIC |
Rye |
2 |
130 |
|
WA |
North Beach |
1 |
130 |
|
QLD |
Highland Park |
1 |
125 |
|
VIC |
Safety Beach |
3 |
120 |
|
QLD |
Reedy Creek |
1 |
120 |
|
QLD |
Currumbin Waters |
1 |
120 |
|
ACT |
Bonython |
1 |
120 |
|
NSW |
Mardi |
1 |
115 |
|
NSW |
Bogangar |
2 |
110 |
|
NSW |
Tweed Heads South |
3 |
110 |
|
TAS |
Deloraine |
1 |
110 |
|
NSW |
Tweed Heads West |
3 |
105 |
|
NSW |
Pottsville |
1 |
100 |
|
VIC |
McCrae |
1 |
100 |
Well Home Loans CEO Scott Spencer said investors in these 20 suburbs are in a strong position.
“If you’re an investor in a suburb that contains only three vacant rental properties, tenants have to compete hard for your property, which gives you the chance to push up rents,” he said.
“All the suburbs in this report are in areas with very low vacancy rates, so even if tenants were prepared to move one or two suburbs along, they’d still find it hard to secure accommodation, giving investors considerable market power.”
Mr Spencer said tenants in these suburbs could consider buying, especially if weekly rents had already surpassed mortgage repayments.
However, some suburbs in the list make it hard for both tenants and potential buyers to afford housing.
“Tweed Heads South and Tweed Heads West, for example, are located in an area in the bottom decile, which means their area is more disadvantaged than 90% of areas within New South Wales,” Mr Spencer said.
“Conversely, Casuarina is located in an area in the top decile, which means their area is less disadvantaged than 90% of areas within New South Wales — this means they would find it easier to cope with the big jump in local rents and to get onto the property ladder.”
—
Photo by @space_launch_system on Unsplash
