Jason Rose

RELIEF may be in sight for renters who have been hit by skyrocketing rents over the past few years.

There has been a small decrease in rental rates across Australia’s capital cities over the June quarter, suggesting rental yields may have hit their peak, according to leading property statistics agency RP Data.

Weekly house rents fell by 3.5per cent nationally over the June quarter, while unit rents dropped 0.6 per cent.

The largest fall occurred in the Canberra market, which saw a drop of 6 per cent for houses, with the median weekly rent falling from $530 in the March quarter to $498 in June.

At the other end of the scale, the only mainland capital city to experience a rise in rent — 6 per cent — was Darwin. Renters there could expect to shell out about $100 more per week than those in Sydney, where rents dipped by about 5 per cent.

RP Data’s national research director, Tim Lawless, said more households were being locked out of the housing market and were finding the only option was to rent. “It now appears that the rental market may have peaked, with national weekly median rents falling slightly in each month post March 2009,” Mr Lawless said.

“And with rental rates now coming off the boil and property values rising we are seeing the first signs that rental rates are eroding.”

The improvement in housing affordability together with the drop in rent has led many renters to consider buying, he said.

There has been a surge in the number of suburbs in Australia where it is now cheaper to buy than rent, according to a recent RP Data study done for the Commonwealth Bank.

Despite the softening in rents, Mr Lawless warned that renters should not get their hopes up too much. Rental vacancies remain tight across the nation, with all capitals recording vacancy rates of less than 3 per cent.

“With such low vacancy rates and not a great deal of new supply entering the market, it’s logical to expect weekly rents to avoid any significant declines for the foreseeable future,” he said.