18 April 2019 | Daily Top Story: Sydney rent prices remain flat, tenants have upper hand

Sydney renters are spoilt for choice, with lower prices and less competition as more properties hit the market.

But in the northern beaches, median weekly house rents have soared $45 in three months, bucking the city-wide trend, according to the Domain Rental Report, released on Thursday.

The city-wide median house rent remained flat at $540 a week over the past quarter, and apartment rents were also flat at $530 a week.

Sydney becomes the second most expensive capital in which to rent a house after being overtaken by Canberra last quarter, but was the only city to have annual price falls for both houses and units, with rent down $10 a week (1.8 per cent) for houses and $20 a week (3.6 per cent) for units.

House rents in the northern beaches and the inner-west increased by $45 and $5 a week over the quarter. In many areas rents have returned to 2016 levels but northern beaches rents are back to where they were a year ago.

Domain senior research analyst Dr Nicola Powell said the number of units on the market across Sydney was up more than 20 per cent year on year, while houses were up almost 13 per cent.

“Current rental conditions provide tenants with a window of opportunity to negotiate rents and terms,” Dr Powell said. “Meanwhile landlords will face greater competition to secure a tenant resulting in rent reductions.”

While rents remained flat over the quarter — off the back of Sydney’s first house rent drop in 12 years — this was still a good outcome for tenants, Dr Powell said, because it was the busiest time for the rental market and when prices were most likely to rise.

Weekly house rents in Canterbury-Bankstown and the city and eastern suburbs took the biggest quarterly hit,  falling 2.8 per cent – or $15 and $30 respectively. The lower north shore had the most significant annual drop, with rents falling 9.1 per cent or $100 a week, followed by the north-west, city and eastern suburbs, and west.

With an increasing number of rentals coming onto the market, the days of finding a tenant in less than a week are long gone, said Rachel Beadman, head of property management at Phillips Pantzer Donnelley.

“It’s competitive and days on market are getting longer,” Ms Beadman said. “A year ago you wouldn’t have had people putting an offer in under the market asking price, traditionally price were driven up … whereas now it’s going the other way.”

“If a property is on the market for $1000 a week, [tenants] are probably trying for around $900,” Ms Beadman said. Rents for high-end, family houses had come down more significantly, dropping hundreds of dollars, she said.

Lauren Beare of The Agency said that in her 18 years in the industry, she had never experienced a market where tenants had so much choice. While once tenants turned up to open homes, they had not even set foot in, with completed applications, they were now knocking back offers to go for their preferred property.

Ms Beare said the time taken to find a tenant on the lower north shore rose about 20 per cent and that, with prices falling, landlords who didn’t meet the market faced an even longer wait.

“As much as we want to advertise the rent at the current level [when re-letting], it’s going to sit on the market for weeks if we do that,” she said.

The most significant quarterly falls in apartment prices were in the south-west and south, down 2.7 per cent and 2 per cent, with the south-west also recording the most significant annual decrease of 5.3 per cent. It was followed by the north-west and upper north shore, while the northern beaches, again, defied the trend with rents up 1.6 per cent over the year.

Supply was again key, Dr Powell said, with unit supply on the northern beaches down 1.2 per cent annually, while supply was up more than 20 per cent in outer regions, topping out at a 40.8 per cent annual increase in the north-west.

Source: https://www.domain.com.au/news/sydney-rent-prices-remain-flat-tenants-have-upper-hand-817138/