Canberra rental listings increase amid coronavirus crisis

More than 480 properties were added to Canberra’s rental market in the past two weeks as vendors made the switch from selling to renting out their homes and home owners converted their short-term stays to long-term rentals.

New data from Domain compared the average number of weekly listings between March 16 and 29 with the previous four weeks. According to the figures, listings in the ACT surged by 29 per cent – the second-highest in the nation, after Tasmania – with 483 listings.

Of those listings, 132 were in Canberra’s Inner North, 94 in the Inner South, 82 in Gungahlin, 67 in Belconnen, 52 in Woden Valley, 29 in Weston Creek, and 27 in Tuggeranong.

Nationwide, 39,252 more properties were listed for rent in the past two weeks, a 19 per cent increase compared to the four weeks prior.

Nardia Kerin of En Vogue Property Management said she had seen a number of people “who had put their properties up for sale and have decided to take it off the market and list it as a rental property”.

“Some owners have also decided to switch their Airbnbs, or short-term stays, for long-term rentals because the occupancy rate has been so low in recent weeks [due to the travel ban],” Ms Kerin said.

Domain economist Trent Wilshire echoed Ms Kerin’s statements, adding that the impact of coronavirus would have a negative effect on the property market.

“It’s going to become harder for people to sell their properties with this downturn coming up as interest drops off, so they will be switching their properties from the selling to the rental market,” Mr Wiltshire said.

According to the Domain Rental Report for the December 2019 quarter, Canberra’s house rental prices was the highest in the nation.

The data showed that Canberra’s median asking rent for houses was $580 per week, up 3.6 per cent year-on-year and 5.5 per cent over the quarter – the biggest jump out of all capital cities.

Canberra first topped the nation’s rental prices in the December 2018 quarter and has continued to maintain that position throughout 2019.

However, experts say we may see a downturn over the next few weeks providing some financial respite for new tenants as more homes list on the market.

“Overall, this means there would be some downward pressure on rents, particularly on areas where there has been a big increase in new rental listings … we are also likely to see a rise in vacancy rates as well,” Mr Wiltshire said.

When comparing the average number of rental listings in the same period in 2019, all the capital cities saw an increase except for the ACT, which dropped by 9 per cent.

Despite the surge in rental listings in recent weeks, Ms Kerin said rental inquiries had decreased.

“There is a lot of uncertainty at the moment so, a lot of tenants are staying put and not moving unless they have to … there are still tenants out there looking for rentals, but the inquiry rate has definitely dropped off,” she said.

While some states had seen adult kids move back in with their parents after coronavirus restrictions put them out of a job, Canberra’s rental market has not seen that yet but it would happen down the track, Ms Kerin said.

“A lot of tenants pay their rents fortnightly or a month in advance so financially, it hasn’t impacted them …  but I predict this may happen in the future,” she added.

The data comes days after Prime Minister Scott Morrison announced a six-month moratorium on residential and commercial evictions for those unable to pay their rent due to the impact of coronavirus.

Real Estate Institute of Australia president Adrian Kelly added that the moratorium was not a free ride for tenants.

“A moratorium on evictions doesn’t mean rent is not payable, it is. If circumstances mean that payment in full is not possible it is a holding-off from payments, not a cancellation,” said Mr Kelly. 

“It is for people who cannot pay at this time, not for those who can. If you can pay your rent now, you pay it. If you can’t pay your rent now, you have been given grace for six months, but will have to catch up when you are able to pay it again.”

The ACT government has also finalised a framework to support ACT renters who are suffering rental stress due to a loss of income related to COVID-19 measures, as part of the second phase of its Economic Survival Package announced on Thursday. 

With a number of renters expected to receive financial support through the Commonwealth Wage Subsidy scheme, the ACT government will encourage landlords to reduce rents by at least 25 per cent for tenants under rental stress.