Rental growth peaks
SQM Research has been ahead of the curve on picking rental market trends with its asking rents index ballooning more than 25 per cent higher in Sydney and some other cities.
In real time, they are now seeing the rental crisis easing as tenants push back on rental price increases and make more efficient use of the housing stock.
Nationally the rental vacancy rate ticked up from 1.2 per cent to 1.3 per cent in June, and asking rents actually declined over the past week in Sydney, for the first time in ages.
Looking at the smoothed 6-month trend, Brisbane and Adelaide and still very tight, but there are signs of pressures easing elsewhere.
Of course, there is still rollicking rental demand expected over the next 5 years - and there probably is a seasonal element to this - but this does suggest that we may be through the immediate worst of the rental crisis, especially in Canberra and Hobart, and much of regional Australia to boot.
Looking ahead, I can also envisage some challenges in Victoria as the new land tax comes into force at a time of higher mortgage rates.
Monthly chart pack
CoreLogic released its monthly chart pack and suddenly there are some signs of easing pressures here too, with new listings rising.
That said, total listings on the market are still declining in line with the usual seasonal trends, and are still almost -30 per cent below average across the capital cities.
Source: CoreLogic
Mirroring what SQM Research suggested, although rents increased by +0.7 per cent in June, the year-on-year growth in rents is now falling.
Source: CoreLogic
This is welcome and really excellent news for the Reserve Bank, since housing costs were one of the components of inflation which were still rising awkwardly.
Inflation can be caused where demand moves faster than supply, but it looks like the worst of the rental crisis may now be blowing over.
It increasingly looks like rents will be a downwards force too over the next year.
