Ayaki Ito at his St Leonard’s apartment.Credit:Louise Kennerley
“My salary is probably quite competitive for my age,and I’m living in a pretty average place and still having to see that my cash flow is negative at times,is quite crazy,” he said.
AMP chief economist Shane Oliver expects Sydney rents will continue to climb,but at a slower rate,forecasting 5-7 per cent annual growth.
“It does seem as if momentum is cooling,reflecting cost of living pressures,possible signs that rental demand might be slowing and the market being up against affordability constraints.
“Wages have not been keeping up with the cost of living … so the ability of renters to pay higher and higher rents is somewhat limited.”
Grattan economic program policy director Brendan Coates said while advertised asking rents were stalling,actual rents would continue to rise as they played catch up to market rates.
“People in existing leases have not seen anywhere near the increases as people[who] have had to move. The fact that advertised rents have stopped rising is a positive step,but you would expect the actual rents to keep rising for a year or two,” he said. “All being equal,those two should equalise.
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“If asking rents stay at that level,we would see actual rents go up 20 per cent. But if they were to fall,they would converge at a lower level.”
Tenants’ Union of NSW policy and advocacy manager Jemima Mowbray said slowing rent increases would offer little reprieve.
“These are still incredibly high rents and people are struggling,” she said. “[Those having to move] are really worried ... when they look at the market it’s clear there is nothing they can afford.“
Mowbray said their holiday hotline had been slammed,as tenants continued to seek help with rent rises,inaction on repairs,and no grounds evictions. Some facing eviction feared they would end up homeless if not given more time to find another property.