Canberra's surrounding NSW regions outpace ACT rent price growth

Canberra rental prices recently hit record highs, making it the most expensive capital in the country in which to rent, but its growth pales in comparison with the surrounding NSW regions.

The latest Domain Rent Report for the March quarter showed Canberra’s median asking rent for a house increased by 3.4 per cent year-on-year to $600 a week. Meanwhile, the NSW regions surrounding the capital saw asking rents soar for houses, especially in Eurobodalla and Yass Valley.

This time last year, these regions saw a rise in rents as pandemic-fatigued tenants made a tree change, but a year on, and rents are still increasing. Median asking rents for houses in Eurobodalla on the NSW South Coast were up 22.7 per cent year-on-year to $518 a week.

With the bushfires at the start of 2020, which heavily affected the area, followed by the onset of the COVID-19 pandemic, locals expected to witness a decrease in demand. Instead, they’ve seen the opposite.

“We were all bracing ourselves for a shocking 12 months ahead or even longer. However, that never eventuated, and we’ve gone from strength to strength,” said property manager Kylie Allan, of Elders Real Estate Batemans Bay.

“It’s very tight at the moment. We’re seeing average rental increases of between $15 and $30 a week, and up to $50 a week in some cases. You’re lucky to find even a unit under $300 a week.

“Both the sales market and the rental market have very little supply and huge demand at the moment, and we just cannot keep up with the demand from people wanting to relocate to the area.”

While a high number of infrastructure projects is helping to attract people to the region, Ms Allan believes it was the opportunity for people to work remotely which drove the biggest increase.

“What we’re finding is a lot of professional couples with a family moving to the area to have a better lifestyle for their children. And, they’re also getting better value for money here from what they’re spending in the city with housing,” she said.

While the 22.7 per cent increase in rental prices is unlike anything Ms Allan has witnessed before, she believes that the figures also indicate a market which is playing “catch-up”.

“Rents down here have been static for many years previously. So, it’s really probably the rent catching up to the market. For the owners, their insurances have gone up in prices, and their rates have gone up in price, yet rents haven’t made that big jump to be level, until now,” she said.

*Based on the Domain Rent Report for the March quarter 2021.

Another area that has seen a marked increase in demand for rentals is Yass Valley, where median asking rents for houses are up 21.8 per cent year-on-year to $530 a week.

Property manager Aimee Mitchell, of Yass Valley Property, said they also saw an influx of people moving to the area for a rural tree change during the pandemic.

“Everything’s getting snapped up quite quickly, both in sales and rentals — they’re not lasting long. People are loving coming to the area,” Ms Mitchell said.

While the easy commute from Yass to Canberra makes it an ideal rural base for Canberrans working remotely, the town has also had new residents move interstate from South Australia and Victoria, as well as a large number from Sydney.

Despite city employers encouraging workers to return to the office, Ms Mitchell believes most people have actually made the permanent move to the area for local jobs, and demand for property will remain strong.

“We have quite a big wind farm between Yass and Boorowa, and there will be another one starting at Rye Park as well. A lot of the [wind farm] companies are renting properties in Yass to house their workers, so that’s also impacting the market and putting prices up,” she said.