By Tyler Wright
Despite recent data reporting an increase in rental vacancy rates, real estate professionals are seeing an increase in demand for rental properties throughout the Dandenong Ranges with a vast amount of rentals now being snapped up off market.
Based in Belgrave, Ranges First National Real Estate has seen an increase in demand for rentals throughout the Belgrave, Emerald, Gembook, Ferny Creek areas and across the Dandenongs throughout the past couple of years, with around 30 rentals leased without advertising since March 2022.
“Tenants have been contacting us a lot more to try and get in before they think anyone else is,” Ranges First National Director Mick Dolphin said.
“Every time something came up, the rent was astronomical because we had eight people applying for it…so those rents went up during Covid and they’ve stayed up as we’ve gone back to normal,” Mr Dolphin said.
According to Business Development Manager Amy Carson, demand has not been able to meet supply.
“Too many people looking for houses and [there are] not enough houses, rental wise,” Ms Carson said.
“We’re still getting people coming out from the city, they’re looking for the lifestyle.
“We’re also finding existing renters in the area as well; wanting to stay in the area.”
According to CoreLogic’s most recent report on rentals in the country, published on Tuesday 10 January, the pace of rental value growth has slowed for the second consecutive month, sitting at 2.0 per cent in the December quarter compared to 2.3 per cent in the September quarter.
This is one per cent lower than the peak quarterly growth rate of 3.0 per cent in the three months to May.
“The decline in quarterly rental growth rates observed in the December quarter was led by the capital cities where rents continued to increase but at a slightly slower rate than they have done in September and June quarters,” CoreLogic Head of Research and report author Eliza Owen said.
But despite the drop in rent value growth and a slight jump in rental vacancy rates (1.05 per cent in November to 1.17 per cent) in December, Ms Owen said “it’s not great news for tenants just yet”.
“Rents are still rising in most capital cities and regional areas with vacancy rates low,” Ms Owen said.
Mr Dolphin said the increased cost of rental properties is the “new normal”.
“20 per cent of our rent roll’s been sold, so there’s actually less houses available to rent because a lot of landlords cash in or just can’t be bothered doing other compliance checks and keeping things up to standard, because it can be a very expensive thing to do on some houses,” he said.
The median price for a rental property in Belgrave is $540 per week, with the median cost in Upwey slightly higher at $563 per week, according to the Real Estate Institute of Victoria.
And the hunt for rentals isn’t expected to slow down in 2023.
“We don’t expect it to slow down, it’s probably gotten busier over the last fortnight…we’re picking up and taking a lot more owners coming into the market,” Ms Carson said.
According to the CoreLogic report, Melbourne is the cheapest capital city to rent in Australia with a median value of $507 per week, followed by Adelaide, Hobart, Perth and Brisbane at $518 per week, $552 per week, $553 per week and $588 per week respectively.
ABS population data has showed a weakening internal migration trend across Canberra and a strong return in net overseas migration for Sydney and Melbourne, the report said.
“Unlike Canberra, high levels of net overseas migration to NSW and Victoria has vastly offset negative net internal migration flows in the year to June 2022,” Ms Owen said.
“Prior to the pandemic, Sydney and Melbourne alone accounted for around two thirds of net overseas arrivals, with high density city centres being among the most popular destinations. This has likely contributed to unprecedented annual growth in unit rents over 2022, which was 15.5 per cent across Sydney and 14.2 per cent in Melbourne.”
