The cost of renting a house in Sydney’s inner west has increased by more than 25% in the past five years. With the median weekly rent now $700 (up from $550 five years ago), it rivals the eastern suburbs.
However, the median rent in the east has remained at $900, exactly the same as it was in late 2011.
This may come as bad news for young renters in the inner west, but undoubtedly the investors are cheering.
The median rent for units in the inner west region is $500 per week, which is on the greater Sydney median.
However, the many high-density developments in the inner west have prevented unit rents from growing at the same pace as house rents. As a result of this, many investors have bought up the limited housing stock, renovated and then increased the rent.
Five years ago, the rent for small inner west houses was $200 to $250 per bedroom. This has now increased to $350 per bedroom.
Whilst some of the student population have turned to their parents to pay the difference, others have been “priced out” of the area.
Due to a change in government policy, tenants in the eastern suburbs have managed better. In 2012, the government made changes to the Living Away From Home Allowance, which gave tax breaks to overseas executives renting in Australia. These executives would rent houses between $2000 and $4000 per week. However, since the market has readjusted, the demand is not there anymore.
Furthermore, many tenants who would have normally rented houses have now turned to apartments.
The eastern suburbs are still the most expensive regions, with the median apartment rent increasing by 21.9% to $585 per week.
In Canterbury Bankstown, the house and apartment rents have also increased. The median house rent has risen by 25% to an all-time high of $500 per week. Apartment rents have also increased over the past five years, by 26.7% to $380 per week.
The best-performing region for apartment rents has been the upper north shore and the north-west.
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