A word from Anthony Webb

A word from Anthony Webb

An estimated 500,000 Australians moved overseas following the pandemic, a trend which should have resulted in less demand for homes and subsequently, cheaper rents. However, with record-low vacancy rates and an increase in rents, Melbourne is on the verge of a rental crisis.

Firstly, lets define what the term ‘rental crisis’ actually means…

A rental crisis is when record low numbers of available rental homes pushes up the price of rent, making it difficult for potential renters to secure a lease. Philip Webb Real Estate manages roughly 5,500 rental properties across Melbourne and has been recording a rental vacancy rate of below one per cent for consecutive months. Last month, there was a 10 per cent jump in rental prices with released properties and the number of days a property remained vacant between leases dramatically dropped to just eight days.

So, what has triggered this surge in demand and restricted supply of rental properties?

Residential rental providers fled the Victorian market at concerning levels in 2021. Some were taking advantage of Melbourne’s strong market conditions, while others were unable to meet the demands of the changed Residential Tenancies Act.

While stock levels were decreasing, demand was on the incline. Those who returned home during the pandemic to ensure financial security have started feeling confident about re-entering the rental market. The return of international students at the start of this year has also contributed to the tightening of the market.

While this tightening of the market has left renters scrambling, there is an opportunity for residential rental providers to re-enter the market and capitalise on the jump in median rental prices and high demand. In fact, Melbourne’s rental market is relying on their return to alleviate Melbourne’ strained rental market.