DESPITE a significant drop in the cost of renting a property in Orange in the past year, experts say the market remains a good place to invest.
Australian Property Monitors’ (APM) latest quarterly report shows the average median cost of renting a house in Orange is $320, $30 less than it was at the same time last year.
The cost of renting a unit also dropped in the past year from $250 to $240.
APM senior economist Andrew Wilson said while rents had dropped investors shouldn’t feel discouraged, as house prices rose last year and vacancy rates remained reasonably low.
“It’s a good news story all around,” Dr Wilson said.
“But I think there’s only going to be a short-term ceiling in rental growth when you look at where rents will go next year.”
Dr Wilson said in the past year there had been an increase in the number of properties in the rental market due to increased investor interest in the Orange market.
“Also last year we saw a lot of people move from renting a property to owning their own home,” he said.
“With capital growth being so strong I don’t think the Orange market has too much to complain about.”
Nationally the median weekly asking price for renting houses increased by 0.9 per cent with unit rents down by 0.4 per cent.
Sydney remains the most expensive capital city for tenants and while house rents remain flat, unit rents increased by 5.4 per cent over the year, driven by demand for inner-city, low-maintenance more affordable apartment living.
The median weekly cost of renting a house in Sydney is $500 and $485 for units.
“Rental yields for houses in Sydney continue to weaken as a result of strong price rises and a surge in investor activity,” Dr Wilson said.
“This year, we can expect to see rising supply and moderating demand put further downward pressure on house rental growth in the city.”