Quarterly house price to rent ratio in Australia 2015-2019

In the first quarter of 2019, the house price-to-rent ratio in Australia was estimated at 104 percent. An indicator of how strong the property market is, the house price-to-rent ratio was calculated by dividing nominal house prices by rent price indices. After reaching a peak in 2017, the price-to-rent ratio has decreased each quarter. According to the source, rent prices have increased slightly, while house price indices have seen a decline leading to a decline in price-to-rent ratio.

Is Australia in a property bubble?

Many industry experts believe the country is in a property bubble – indicated by the rapid increase in Australian property market prices to the point that they are no longer relative to incomes and rents, followed by a decline. The house price-to-income ratio has also followed a similar trend, falling to 102.6 percent in the first quarter of 2019. When considering only capital cities, the number of new property listings have similarly declined and was at the lowest number in the year ended May 2019.

Housing demand

Although many major cities have experienced a sharp decline in residential property prices in the past year, with Sydney and Melbourne hit the hardest, the rental market indicates the demand for housing is still variable across regions. The rental vacancy rate, which indicates how many properties are available for rent out of all the rental stock, was relatively high in Sydney. This is positive for tenants, as the already high rent prices will likely not increase as quickly with a lower vacancy rate.

House price to rent ratio in Australia from 3rd quarter 2015 to 1st quarter 2019

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Sources

Release date

July 2019

Region

Australia

Survey time period

Q3 2015 to Q1 2019

Supplementary notes

Release date is date the data were obtained.

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Statistics on "Residential housing in Australia"

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