Restrictive rent prices in inner Sydney and transient labor attracted to construction and infrastructure projects in the city is helping to boost rental prices on the outskirts of the metropolitan area, according to a new study from PRDnationwide. Prices for one- and two-bedroom units in hotspots like Canterbury, Liverpool, Cambpelltown and Fairfield are climbing, and locations closer to the city center are climbing higher and faster than others. Other areas outside of the Sydney Metropolitan Region are also booming, such as Cassnock and Maitland. For more on this continue reading the following article from Property Wire.
The private property rental market in Sydney is heating up, with one and two bedroom rents up in many locations, new research shows.
PRDnationwide research reveals rents for two bedroom apartments in Campbelltown, Fairfield, Liverpool, Maitland and Canterbury grew faster than any other area in the Sydney Greater Metropolitan Region over the past five years.
PRDnationwide research analyst Oded Reuveni-Etzioni has identified the areas which experienced the highest rental growth since 2006.
‘Savvy investors are attuned to the changing preferences of renters and recognise the growing rental markets in the middle and outer suburbs of the metropolitan area,’ he said.
‘Investment opportunities also exist in areas outside the metropolitan area, where strong demand and limited supply of units maintains the pressure on rent prices,’ he added.
The research covered medium and high density dwellings in the Sydney Greater Metropolitan Region (GMR) which includes the Sydney metropolitan area, the Hunter and the Illawarra.
Not surprisingly the City of Sydney recorded the highest rent price for both one and two bedroom units as $500 and $670 per week respectively.
Other LGAs to appear in top 10 highest rent prices list were Woollahra, Canada Bay and North Sydney while the Ku-Ring-Gai Local Government Area recorded the highest growth in demand with an average of 22.6% increase in new bonds lodged per annum for the past five years. This means that the number of bonds held in the Ku-Ring-Gai LGA have more than doubled since 2006.
‘This indicates a shift in tenant demand from inner to middle and outer parts of Sydney Metropolitan Area,’ said Reuveni-Etzioni.
Other booming areas outside of the Sydney Metropolitan Area include the Cessnock and Maitland LGAs which both recorded a strong increase in the lodgement of bonds for strata-titled dwellings, with Maitland also recording one of the strongest five year average growths in rent prices at 10% per annum for a two bedroom unit.
‘The growth stems from large infrastructure projects that draw a transient population of construction workers, and from mining employees relocating to the Hunter and choosing to rent in the short term,’ explained Reuveni-Etzioni.
He pointed out that given the strong growth in rent prices in the middle and outer rings of Sydney and regional areas of the GMR, and the increasingly restrictive rent prices in Sydney’s inner ring, it is likely that lenders will continue their support for medium density developments in areas that until recently represented higher investment risk.
‘This in turn will ensure that developers maintain a full project pipeline in the outer and regional parts of the GMR,’ he added.
This article was republished with permission from Property Wire.