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Weekly rents are failing to keep pace with rising property values across most of Australia’s capital cities.
According to CoreLogic RP Data, the combined capital city’s average rent in March has risen by just 1.7 per cent over the past year, compared to a 7.4 per cent capital gain in property values.
Sydney showed the highest increase in weekly rents over the year at 3.3 per cent.
Perth showed the most substantial correction, with weekly rents down 4.1 per cent over the past 12 months.
CoreLogic RP Data said the fact property values are moving higher at a much faster pace than rents is causing gross rental yields to consistently compress across each of the capital cities.
Since mid-2013, the average gross rental yield across Australia’s combined capital cities has reduced from 4.3 per cent to 3.6 per cent.
Gross rental yields are now approaching record lows in both Melbourne and Sydney, at 3.3 per cent and 3.6 per cent respectively.
Melbourne recorded a 3.2 per cent gross rental yield for houses and a 4.1 per cent gross rental yield for units.
Sydney’s gross rental yield was 3.4 per cent for houses and 4.3 per cent for units.
Perth recorded a gross rental yield of 4.1 per cent for houses and 4.6 per cent for units.
Canberra also recorded a 4.1 per cent gross rental yield for houses and a 4.9 per cent yield for units.
Adelaide’s gross rental yield was 4.2 per cent for houses and 4.7 per cent for units.
Brisbane recorded a gross rental yield of 4.5 per cent for houses and 5.4 per cent for units.
Hobart’s gross rental yield was 5.3 per cent for houses and 5.4 per cent for units.
Darwin recorded the highest rental yields for both houses and units, sitting at 5.7 per cent and 5.9 per cent respectively.
[Related: Rental yields fall below 2pc in some suburbs]
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