It has made headlines around the country throughout the last 12 months: it appears that the downturn of the resource sector is presently shaping the rental market across Australia.
It was reported as early as the start of this year that valuers had noticed a significant price decrease in house values within mining towns; some having halved since 2001.
Property owners, previously employed on a fly-in/fly-out basis, have been pressured to look for work elsewhere due to the downsizing of the sector. This has caused many to abscond to other states – many heading south, breaking tradition being that generally resource work has conventionally traded in northern Australia.
Not only has this played a role in sale prices in mining towns, it has also triggered the recent surge in vacancy rates in these areas – further contributing to a significant decline in rental yields.
It is currently an employer’s market within the sector, which has caused property owners who were previously earning six-figure incomes to rent their homes to ensure they are able to retain them. They now must endure a decrease in income from their newly gained employment.
This is shaping the rental market as we know it. It has long been a case of 'supply versus demand' and, at the moment, the supply of previously owner-occupied homes situated within the higher end of the market are definitely on the increase.
It does not take a brain surgeon to see that this shift will affect the rental market for years to come. The owners will either need to return to the property at some point or sell the property.
With interest rates the lowest they have ever been, it would be logical to assume that once they start to rise again it is going to have a dramatic outcome on the housing market.