Rents in outer suburbs rise 9.4%
Here's another they might have used:Rents in inner and middle suburbs stagnate
As always, the Rent and Sales Report bares closer and more careful reading than the headlines suggest.
The main breakdown for median 'new agreement' rents:
- Inner ring: up 2.2 per cent for the quarter to December, 0 per cent for the year
- Middle ring: 0 per cent for the quarter, 0 per cent for the year
- Outer ring: up 2.9 per cent for the quarter, 6.1 per cent for the year
- Sydney overall: up 1.3 per cent for the quarter, 3.9 per cent for the year
- New South Wales overall: up 2.9 per cent for the quarter, 6.1 per cent for the year.
Where did the Herald's figure – 9.4 per cent – come from?
This figure is for three-bedroom houses and flats in the outer ring of suburbs. It's the largest annualised figure on the first table of the report – that's why they ran with it (that's how time-pressed journalists read the Rent and Sales Report: scan the first table for the biggest number – there's your story).
And, as always, the figure relates to rents for new tenancies commencing in the relevant quarter. Tenancies commencing in the December 2009 quarter represent about 9.2 per cent of all private tenancies in the outer suburbs (and tenancies in three-bedroom dwellings would be somewhat less). Outer suburb tenancies commencing in the December quarter represent less than 3.5 per cent of all tenancies in Sydney.
When publishing 'Rent & Sales Report' Housing NSW also publishes a time series of median weekly rents (for new lettings) back to the March quarter 1990.
ReplyDeleteIt’s interesting to see what’s happened with rents over the last twenty years.
Take the median rent for 1-bedroom dwellings in the Leichhardt local government area. This was $135 per week in the March quarter 1990 and $360 per week in the December quarter 2009. For those who are mathematically inclined, this represents an increase of $225 per week, or 167%, over twenty years.
It is worth comparing this to Consumer Price Index over the same twenty year period. The CPI (All Groups, Weighted average of eight capital cities) was 100.9 at 31 March 1990 and 169.5 at 31 December 2009. Over the last four years, the CPI (All Groups, Sydney) has been very close to the CPI (All Groups, Weighted average of eight capital cities). If we assume that this has been the case over the last twenty years, then the CPI (All Groups, Sydney) has increased by 68% over twenty years.
That is, rent for 1-bedroom dwellings in Leichhardt local government area have increased by 167% over twenty years, but the CPI has increased by only 68%.
Now, that’s a windfall for landlords!