Rents are falling in pockets of Sydney, providing potential relief for more than one in three households across the city.
The median rent for Sydney as a whole is $550 a week for both houses and units and this is stable year on year, Domain data reveals. However, there are noticeable falls in the asking price when you drill down to regions and suburbs.
Fiona Sives, her partner Paul Smyth, and their seven-year-old twin boys have taken advantage of the softening market, by moving to a bigger, better – and cheaper - house in the same suburb.
They were paying $750 a week to rent an unrenovated three-bedroom Federation-era house in Croydon. They lived there for two years, when the landlord tried to raise the rent by $30 a week.
The couple negotiated the increase down to $10 a week but it prompted them to look at other properties in the area.
Ms Sives set up a daily alert from a real estate website and checked out data on bonds lodged via the NSW Tenants’ Union’s rent-tracker tool. “I could see that there were better homes for less money,” she said.
In June they moved 400 metres to another three-bedroom house, a similar vintage to their previous house but “much nicer” and only $730 a week in rent.
“It’s in much better condition,” Ms Sives said. “It has an addition so it’s bigger. The kitchen is more modern. The living space is better configured.”
Ms Sives is lucky - the median asking price for a house in Croydon is up 3.4 per cent year on year and in the inner west as a whole, prices are yet to fall.
But advertised rents for houses have fallen in the city and the east, lower north shore, north west, northern beaches and upper north shore, while advertised rents for units have fallen in the lower north shore.
“We’re already seeing certain regions of Sydney present opportunities for tenants and we’re certainly seeing rent prices decline,” said Dr Nicola Powell, data scientist at Domain Group.
There were 553,000 rental households in Greater Sydney recorded in the 2016 census. That accounted for 34.1 per cent of total households, while 33.2 per cent own their homes with a mortgage, and 29.1 per cent own outright.
Domain data reveals the sharpest percentage fall in rental prices for houses was in the city and east, with a 5.5 per cent fall in advertised rents from $1100 in June 2017 to $1040 in June 2018.
The lower north shore is the only area of Sydney to record a fall in the asking rent for both houses (a 4.5 per cent decline to $1050) and units (3.2 per cent fall to $600).
The suburbs with big year-on-year falls in rents include the upper north shore suburbs of Killara, where house rents dipped 10.9 per cent from June 2017 to June 2018, and Gordon, where unit rents dropped 9.2 per cent over the same time frame.
Canterbury, Earlwood, Kellyville, Killara and Turramurra, Cremorne Point and Mortlake also saw large falls in asking prices.
In Sydney’s north-west, with suburbs such as Marsden Park, where streets of new properties are up for rent, some agents are offering two weeks rent-free or rent by negotiation.
But tenants’ advocates say it’s still far from a renters’ market.
Leo Patterson Ross, senior policy officer, Tenants’ Union of NSW, said data showing falling rents did not always translate into lower rents for tenants on the move.
“People looking to rent are often moving from a place that they moved into a year or more ago so they will still experience a rent rise from their current place to their new place,” Mr Patterson Ross said.
Mr Patterson Ross said experience in the Perth market suggested a softening market could make it easier for tenants to negotiate longer leases and minor alterations but not pets.
The NSW Residential Tenancies Act now allows tenants to ask for minor alterations and landlords can’t unreasonably refuse.