Record rent rises across Australia are being driven by two factors: shore and ore.
Coastal areas in many regions are home to rocketing rents as a result of city-dwellers pursuing sea changes in places that are less population- and COVID-dense, and trying before they buy. Mining towns, on the other hand, are continuing to surge on the back of strong resource prices.
“When you look at the top 10 areas for rent increases, it’s all either coastal holiday areas or resources towns,” said Domain chief of research and economics Dr Nicola Powell.
“I think this is the time they’ll be showing their biggest increases too, as it’s the big changeover time in rental properties for the holiday season, so they’ll be at a real pressure point.”
So, what are the top rental movers and shakers around Australia, and why?
CRESCENT HEAD, NSW: Median rent $680; Annual rise 54.5 per cent
On the Macleay Valley Coast, 340 kilometres north of Sydney in the Kempsey Shire, Crescent Head is set between the ocean – with a world-renowned surf break – and the river.
Over the past two years, it’s grown from a sleeping beauty to a fully fledged princess, as more and more people have left big cities for the fresh air of being by the sea, especially as COVID-19 has proved both a curse and a boon for those dreaming of zapping the commute and working from home.
“We’ve just had so many people coming here to live now, both renting and buying,” said Nathan Wilson of Elders Real Estate Crescent Head. “It’s been crazy. Many of those people have been coming here for their holidays for years or have just discovered it.
“A lot of them have realised they can work remotely, so they can live here in a beautiful place with eateries and the kind of facilities a small town has. Fortunately for the locals, who often rent for years at a time, property-owners have tended to honour their commitments and haven’t put their rents up to market prices.”
BROULEE, NSW: Median rent $750; Annual rise 50.0 per cent
On the south coast, between Batemans Bay and Moruya in the Eurobodalla region, 300km from Sydney, this is a favourite spot for those who love outdoor life and a favourite holiday destination for Canberrans.
“It’s a really magic area with a beautiful beach and it’s close to the ACT for visitors,” Dr Powell said. “With such extreme rates of rental growth, though, you have to ask whether locals will still be able to afford to live there.
“But then the question has to be asked, how much of this is permanent growth? There have been reports of people in the cities going back to the cities, and it might just be that this growth happens during the period when the pandemic hits the hardest.”
MOUNT COOLUM, QUEENSLAND: Median rent $750; Annual rise 47.1 per cent
A Sunshine Coast favourite, Mount Coolum encompasses many distinct areas, and the staggering rental growth has mostly been driven by a smaller sub-sector, locals say.
“The exciting part is right on the beach, which the locals call The Boardwalk, and rent growth there is driving increases for the whole area,” said James Henley of Richardson & Wrench, Coolum.
“We’ve definitely had so many people moving here from elsewhere in Queensland, and a lot of inter-staters from Melbourne and Sydney, that prices have risen. I think it reminds Sydneysiders of their northern beaches, but with a much more relaxed lifestyle, and it’s close to Noosa and Maroochydore, but more affordable.”
SOUTH HEDLAND, WESTERN AUSTRALIA: Median rent $588; Annual rise 47.0 per cent
Resources prices are still rising, so people continue to be keen to move to the Pilbara’s South Hedland, a suburb of Port Hedland, to work for the iron ore industry.
With borders snapping closed for a long time, it means there’s no fly-in-fly-out workforce, so everyone has either had to buy properties or rent them. This has in turn put unprecedented pressure on rental prices.
“Resources areas are generally showing a significant rise in rents as a result of mining doing so well,” Dr Powell said.
VAUCLUSE, SYDNEY: Median rent $2900; Annual rise 45.0 per cent
With the COVID-19 lockdowns making everyone realise how important lifestyle is, there are still some who prefer to stay in Sydney but, if they can afford it, live in some of the most salubrious areas.
Vaucluse, in the eastern suburbs, is one of those.
“It also has its own little beach, so it’s a good compromise rather than going to the coast,” said Dion Markovics of Raine & Horne Double Bay.
“It’s always a very lovely place to live, and there’s been a lot more demand than supply.”
DOUBLE BAY, SYDNEY: Median rent $2000; Annual rise 42.9 per cent
Also in Sydney’s east, and also with its own beach, Double Bay is also going through something of a renaissance. There’s been a fair amount of property development taking place and parts of the shopping strip are undergoing renewal as a result.
It’s also very close to the beaches at Bondi, Coogee and Clovelly.
“People are really looking for lifestyle and fresh air,” Mr Markovics said.
“The changes in the infrastructure in Double Bay mean it’s now appealing to a younger demographic too, which is creating a lot of supply for both rental property and homes to buy, pushing up the prices of both.”
QUEENSTOWN, TASMANIA: Median rent $250; Annual rise 42.9 per cent
The largest town in Tasmania’s west, Queenstown was once the world’s richest mining town. Now there are studies to see if it might be worth reopening the copper mine, with resource prices soaring so high.
But a strong tourism sector is growing to replace the mining income and, with the recent opening of a number of mountain bike trails, the town is becoming much better known to outsiders looking for a place to escape the cities – and the pandemic.
“Prices have really continued to rise, with people wanting to go to smaller areas and get away from coronavirus,” said Rodney Triffett of Harcourts West Coast. “People have had enough of lockdown in the cities and, until our border opened, we were coronavirus-free.
“We’ve had so much demand for properties and very low stock, which has been pushing rents higher and higher.”
PORT HEDLAND, WESTERN AUSTRALIA: Median rent $851; Annual rise 41.6 per cent
Port Hedland, like its suburb South Hedland, and the home of the country’s biggest bulk export port servicing the iron ore mines inland, continues to experience rents rising rapidly as a result of surging iron ore prices.
The industry has proved pretty impervious to the COVID slump, and rents have risen sharply accordingly. In the previous September quarter, house rents skyrocketed by 45.4 per cent.
WEST GLADSTONE, QUEENSLAND (units): Median rent $250; Annual rise 38.9 per cent
Often described as the gateway to the Southern Great Barrier Reef – think Heron Island and Lady Musgrave Island among others – West Gladstone is an area with a proud industrial history but also a tourist favourite.
Unit rents have risen sharply with an influx of other Queensland and inter-state renters coming to a place that’s a very pleasant escape and offers work.
SOUTH HEDLAND, WESTERN AUSTRALIA (units): Median rent $451; Annual rise 38.8 per cent
With house rents shooting up by 47 per cent, it was inevitable that unit rents would rise, with many families who can’t afford houses having to consider apartment-living instead. There’s also a dire shortage of units in the town, and consistently high demand.
BUNDALL, QUEENSLAND: Median rent $895; Annual rise 37.7 per cent
A suburb on the Gold Coast, on the Nerang River, just behind Southport, Bundall is considered by many to be a picturesque and relaxed place to live, with a network of canals creating waterfront homes, and the beach, cafes and shops nearby.
With rentals in hot demand, it’s also the home of the Gold Coast Turf Club, where the Magic Millions Carnival is held, and a new cultural precinct is being developed. For those who want to live on the Gold Coast, it’s also quieter than Surfers and the CBD.