These are words renters don’t often hear, but according to new data released today, rents in Sydney have dropped for the first time in 12 years.
The Outlook report, by the peak national association for the construction and development industry, the Housing Industry Association (HIA), says real rental prices have been falling in half of the country’s capital cities for almost five years, and in 2018, Sydney joined the ranks.
“This is a significant reversal of the trend,” said the HIA’s NSW executive director David Bare in a statement. “From December 2006 to June 2015, the pace of rental price increases exceeded inflation for every year leading to real rents doubling in this decade.”
That’s changed since more housing came onto the market. “Rental prices rise when there is insufficient supply of rental accommodation to meet demand. HIA has long argued that the solution to this problem is to increase the supply of new homes.
“An unprecedented volume of new homes (especially apartments) has been coming online since 2014 – five years’ worth of supply in four years. Unmet demand is now being dealt with and affordability has improved.”
But Bare warns that unless we see another 50,000 houses come onto the market in NSW each year, the good times won’t continue for renters because population growth will outstrip supply.
“To achieve this there needs to be a more consistent supply of new dwellings and a determined effort by the NSW state government to reduce the cost of punitive taxes and levies on housing,” he says.