Canberra rent prices no longer the most expensive after quarterly decline: CoreLogic rental review

The median price of rent for Canberra dwellings - which combines houses and units - fell 0.7 per cent over the March quarter to $674 per week, new figures from property data firm CoreLogic show.

It was driven by a 1.3 per cent fall in house rents to $712 per week. Meanwhile unit rents saw an increase of 0.5 per cent, taking the median price to $585 per week.

Canberra's vacancy rate improved, rising from 0.7 per cent a year ago to 2 per cent.

The latest rental report by CoreLogic shows Canberra and Darwin were the only two capital cities to record a quarterly decline in rents.

Melbourne and Sydney led the national uptick with increases in dwelling rents of 3.7 per cent and 3.4 per cent respectively. National rents rose 2.5 per cent for the quarter.

Sydney overtook Canberra as the most expensive market for renters, with the median dwelling rent now $699 per week.

CoreLogic economist and report author Kaytlin Ezzy said growth in unit rents had outpaced house rents across the board.

"Rental growth conditions across the capitals were likewise skewed towards the medium to high-density sector, with each city recording a larger quarterly and annual increase in unit rents compared to houses," she said.

Every capital city recorded an annual rise in gross rental yields. Canberra's rental yield across all housing types was 4.19 per cent, up from 3.82 per cent 12 months ago. The current rental yield for Canberra units was 5.13 per cent, compared to houses at 3.88 per cent.

Despite the increase, Ms Ezzy said it was likely net yields had declined.

"Weekly rents rose by approximately $48 per week between April 2022 and March 2023, however the average weekly investor mortgage repayment on the typical Australian dwelling increased by $184, leaving investors $136 per week worse off," she said.

Little financial incentive for investors to enter the market meant supply was unlikely to increase substantially any time soon, Ms Ezzy said.

"It's likely some tenants are now sacrificing the spare room or home office and re-forming share houses that disbanded throughout COVID in order to share the rental burden," she said.

"Those who have the financial means to pull together a deposit might be taking the plunge into home ownership sooner while others are locking in longer leases, rather than brave the hunt for a new rental."

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