1 week Ago By Sarah Petty
28 Carbine Ave, Clarinda is up for lease for $675 per week. Regional Victoria and the Mornington Peninsula are home to some of the worst rental conditions nationwide, with a stark warning that costs could still rise further. Suburbtrends’ September Rental Pain Index scored 317 areas across the state as suffering from poor vacancy rates and high lease costs, which are combining to wipe out substantial chunks of tenants’ income.
The Index assessed 467 regions across Victoria, attributing areas with a rental pain index score based on lease cost increases, affordability against income and vacancy rates. RELATED: Melbourne tenants cop $2900 extra charge in rent in past 12 months Single Aussie mums pushed out of rental market, housing crisis commission hears Vic suburbs where the most landlords are selling homes Mornington, Hastings and Somers received the worst possible ratings for tenants at 100. Also in regional Victoria, Castlemaine, Camperdown, Wangaratta and Myrtleford all rated at or higher than 98.
In Greater Melbourne — Sandringham, northern Noble Park and Clarinda were some of the most unfavourable places for renters to lease homes, scoring 97 and above. PropTrack research showed rents increased by 10.6 per cent in the 12 months to June this year.
Suburbtrends founder Kent Lardner said even though rents had surged more than 10 per cent, there was “still room for growth” as Victorian tenants typically weren’t paying more than 30 per cent of their income on rent. “In an environment where you’ve got low vacancy rates, you’ve still got a little bit of slack in the ropes; that tells me that rents still might be bumping up for quite a few months,” Mr Lardner said. 89 Wilsons Rd, Mornington is listed to lease — a suburb highlighted by Suburbtrends as having one of the worst rental markets across the state.
The four-bedroom townhouse can be rented for $875 a week. Suburbtrends defines rental stress as tenants earmarking more than 30 per cent of their income to pay their lease commitments. Seachange Property Geoff Oxford said he was getting three to five phone calls on a weekly basis from Mornington Peninsula tenants looking for a new rental, as their landlords were either moving back in or wanting to sell, but he didn’t have any.
“I have nothing to offer them; I get emotional for them because there’s literally no alternatives to find these people houses because there’s not enough rental properties,” Mr Oxford said. “Land taxes (have) destroyed any hope of investment for small landlords, mum and dad investors, and there’s just no incentives for people to buy properties to rent out anymore.” He said he believed the region had lost about 30 to 40 per cent of its rental stock in the past three years, at the same time weekly rents had increased by about the same amount.
Mr Oxford added that the state government’s land tax increases and the potential Airbnb levy were causing landlords to sell up as they no longer saw their investments as viable. 2/165 Bay Rd, Sandringham is listed for lease — Suburbtrends has highlighted Sandringham as one of the worst places to rent a home across the state. The two-bedroom house can be rented for $620 a week.
Metro Property Management director Leah Calnan said rental properties across Greater Melbourne and the Mornington Peninsula were taking slightly longer to lease, as tenants didn’t have any more money to spend. Ms Calnan said in the past six weeks or so, they had asked rental providers to adjust their weekly rent expectations. She noted that not as many renters were applying to lease properties probably in fear of being unsuccessful after attending busy inspections.
“Say 20 people registered to attend, only 10 people attend, and maybe only one or two apply,” she said. Area – Rental Pain Index Mornington – 100 Hastings, Somers – 100 Castlemaine – 99 Camperdown – 98 Sandringham, Black Rock – 98 Wangaratta – 98 Myrtleford – 98 Yarram – 98 Noble Park – 98 Clarinda, Oakleigh South – 98 *Areas reflect SA2 statistical regions Source: Suburbtrends Sign up to the Herald Sun Weekly Real Estate Update. Click here to get the latest property market news delivered direct to your inbox.
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