Rents are higher than a year ago across almost all areas of regional NSW, led by a spike in smaller towns as priced-out tenants look further afield. A strong agricultural season and an inflow of new residents in some towns have also driven demand, while few homes are available.
The median asking rent for a house in regional NSW reached $640 a week in the September quarter, up 4.9 per cent or $30 a week on a year earlier. The steepest rise was in the Berrigan Shire in the Riverina, west of Albury, where asking rents climbed 18.5 per cent to a median $480 a week, followed by Bellingen near Coffs Harbour, up 18.2 per cent to $650. Liverpool Plains Shire outside Tamworth rose 17.5 per cent to $470, and Moree Plains Shire was up 15.4 per cent to $450.
In Victoria, Glenelg Shire, in the far south-west near Portland and about 350 kilometres west of Melbourne, recorded the largest annual growth at 17.8 per cent, with weekly asking rents jumping from $450 to $530. Mount Alexander, covering Castlemaine, Campbells Creek, Harcourt and Maldon, was second, up 15 per cent to $575, followed by Northern Grampians (10.3 per cent), Campaspe (10 per cent) and Golden Plains (10 per cent). In contrast, lifestyle locations such as Alpine, Latrobe, Mansfield and Indigo, home to Beechworth, held steady over the year.
Domain chief residential economist Dr Nicola Powell said the growth had shifted from major lifestyle destinations to smaller regional markets. Rents held steady across regional NSW over the three months to September, a seasonally weaker time for the rental market ahead of summer.
"Affordability constraints are becoming a lot more pressing," she said. "When you look at rents they've risen substantially over the past five years and that just leaves less room for further rapid increases."
Powell said rental markets in many areas were affected by housing supply and the strength of the local economy, spanning agricultural areas where demand from extra workers placed pressure on a small housing stock and lifestyle areas still attracting retirees and sea-changers. In Victoria, an exodus of investors was reducing already limited rental stock.