COVID-19 is impacting the residential property market in various ways, but perhaps the most impact could be felt in the rental space.
Australia’s rental market was already in decline, before COVID-19. Today, we are faced with new challenges. As tourists remain barred from entering Australia, and short-term rental arrangements are restricted by government policies, Airbnb rentals have shifted to long-term rentals. The increased supply means rents could decline.
This is compounded by a decrease in demand. Increased job losses have caused some tenants to renegotiate for payment plans, reduced rents, or seek alternative accommodation, like opting to live with their parents. A break on the movement of foreign students and migration numbers have led to more properties becoming vacant, while local students are less prone to rent near universities, as they get into remote study.
Another contributing factor is that while most of us have been staying home, the construction industry has been able to forge ahead with less disruptions and deliver completed projects ahead of schedule.
A number of datasets identify Inner Sydney and Melbourne, high density and expensive accommodation, as being most impacted whereas Newcastle has not been impacted anywhere near the levels of the larger cities.
Let us know if you have questions or would like more information about the performance of rental properties in your postcode or suburb.