More action needs to be taken to encourage property investment across Australia if a rental crisis is to be avoided, according to the Real Estate Institute of Australia (REIA).
The March quarter edition of Market Facts from the REIA shows rental vacancies ranging from a low of 0.8% in Perth to 2.3% in Hobart.
High demand and lack of housing supply is driving up rents across the country, with a three bedroom house in Canberra now costing $342 per week on average to rent.
The rental price of a three bedroom house in Sydney increased by 1.8% in the quarter to March and 7.9% over the quarter in Darwin, according to the REIA data.
Graham Joyce, president of the REIA, said the rise in rents will encourage investors, but more needs to be done by government to increase housing supply.
He said: "Rent increases are resulting in rises in rental yields and returns, providing renewed opportunity for investors in many areas."
He added that government must give consideration to providing more equitable taxation treatment for property.
"The advantageous taxation treatment of other asset classes is keeping investors away from property despite improving yields and returns. This will prove to have social and economic costs; we already have a shortfall in property supply and the situation will continue to worsen without increased construction and participation by investors," said Joyce.
