Predicted rent rise could mean spending power falls further

Mozo

Wednesday 13 January 2010

Rents on Australian homes are likely to rise in the coming months, an expert has said.

Matthew Bell, an economist at Australian Property Monitors, told the Australian that rental markets would be boosted by the end of the first-home buyers grant, brighter employment prospects, strong house price growth and low vacancy rates.

Mr Bell said that rent rises in Sydney would at least double the 2009 rate of 2.2 per cent and that Melbourne’s would rise by five per cent following a flat year.

In Perth, Mr Bell said that median house rents could rise by 11 per cent this year in line with the average growth rate of 12.4 per cent experienced since 2003, while he expected Brisbane rents to increase by about eight per cent.

Rising rents may encourage Aussies to compare savings accounts as their budgets receive a further squeeze. Last week, a report by the Daily Telegraph suggested that households will also face paying up to $76 a week extra in rising living costs this year.

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