Rental potential for houses and units is positive for Mornington Peninsula landlords
Nice nest eggs
On the Peninsula, the level of available stock for rent has more than halved (- 54%) since February 2012.
With interest rates tracking lower, consistent demand for stock and stable rent prices, there’s no downside to renting out your property. Take advantage of negative gearing, treat it like a business and make sure you’re maintaining the property to make it more appealing to quality tenants. Anything you do to improve the property contributes to its value over time.
Across the Mornington Peninsula, median weekly house rents sit at $440. Unit rentals dipped slightly, despite remaining stable across the year, landing at $364 per week. As rental properties, units are still a solid choice for investors in the longterm.
Rent on a typical unit has increased by 6.5 per cent over the past three years. For comparison, house rents increased by nearly 9 per cent over that 3-year timeframe. Gross rental yield remains healthy at 4.1% for two-bed units, 3.8% for all units. Slightly higher than the current return on houses which have an average yield of 2.9 per cent.
Robust population growth means demand for rental properties remains strong:
- For rental properties listed in December, over 26 per cent were tenanted within 30 days.
- At 1.7%, the vacancy rate is tighter than Melbourne’s, even with the glut of inner-city apartments.
I’ve included some sources and links below if you’re interested in regularly tracking pricing trends. Talk to our property management team for more granular information about your property and suburb.
- Domain Rental Reports – quarterly (capital city and regional overviews)
- SQM Research – historical region/city/postcode level data including monthly vacancy rates, rental yields, weekly rent prices
Source: SQM Research Weekly Rents Index January 12, 2020
Robert Bowman is a licensed estate agent, auctioneer and proud Mornington Peninsula local.
Contact him on 0417 173 103 or email for advice on buying and selling, building investment portfolios and new developments.