Market Update – Spring Guide

September 24, 2024

As spring unfolds, we aim to keep you informed about the changing landscape of the Melbourne rental market. In this edition, we are here to share an overview of recent market trends and important legislative updates, to assist you in navigating the market effectively.

Changes Ahead: New International Student Caps

The Australian Government has recently introduced the National Planning Level (NPL), which will cap the growth of international student programs starting in 2025, limiting new student commencements to 270,000. This policy follows several other changes, including increased visa fees, stricter English proficiency requirements, and restrictions on ‘visa hopping’. With 331,775 student visas granted in 2023-24—a 34% drop from the previous year—Melbourne’s CBD rental market is likely to see higher vacancy rates and softer demand. (Source: SBS)

As the market adjusts to these shifts, now is the perfect time for property owners to reassess their rental strategies. We invite you to contact our team for a professional rental appraisal to ensure your property remains competitive and well-positioned in this changing landscape.

Short Stay Levy Takes Effect January 2025

We would like to remind property owners that, effective January 1, 2025, the Victorian government will introduce a short stay levy of 7.5% on total revenue generated through online platforms. This levy will affect all short stay accommodations rented through providers such as Airbnb and Stayz.

We encourage you to take note of this upcoming levy and we are always here to assist if you would like to review your investment strategies.

Rental Report Statistics

Rental performance in Melbourne’s CBD has demonstrated resilience this quarter, with the median weekly rent sitting at $630—significantly above the Metro Melbourne average of $540. With rental yields at 6.7%, compared to 4.5% in the broader metropolitan area, these figures highlight a sustained demand for properties in Melbourne’s inner suburbs. This consistent performance suggests that the CBD remains a prime market for investors seeking attractive returns, particularly when contrasted with the wider metro region. (Source: REIV)

Categories: Buy, Rent, Sell, Lease

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