Gary Davies and his partner were paying $950 in rent per week for their run-down flat – but they’ve slashed $300 off that hefty bill by taking part in the nation’s COVID exodus.
The couple realised rents had been falling across the city as a result of the coronavirus crisis, and decided to move out of their ground floor Potts Point apartment and into a brand new one in Zetland.
Their new home is on the 15th floor with “amazing views”, lifestyle amenities and a modern kitchen – and not only is it $300 a week cheaper at $650, they also managed to score two weeks of free rent as landlords scramble to entice apartment tenants in particular.
“Where we were living before was quite expensive and it wasn’t bad, but it was old and needed a bit of a renovation with mould on the roof and that kind of stuff – there was no light at all,” Mr Davies told news.com.au.
“Some mates were moving to Zetland so we looked around and found a brand new apartment on the 15th floor with a pool and sauna that’s so much cheaper, so it has been a good decision.
“It’s got a marble kitchen and it is basically a big upgrade – for $300 less a week than before.”
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The 28-year-old said he had decided to look into moving house as it was now a renter’s market.
“I heard through the grapevine that because of COVID-19 people can’t rent out apartments – I actually heard of one place offering four weeks of free rent (to lure renters),” he said.
“Our new place was on the market for $800 before we got it for $650 after they dropped the price.
“Thank you COVID – it’s one of the only good things to come out of it.”
The rope access technician said at least three other friends had moved to take advantage of cheaper rent recently and said the market had changed dramatically in a short period of time.
“There are so many more places out there now and fewer people to take them, especially as there’s less people in the country now,” he said.
Mr Davies, who is originally from Scotland but who has been living in Sydney for three years, said his advice for other renters was simple – “go for it”.
“It’s definitely worth the effort to find a new place,” he said.
“For example, I’m planning to go home to Scotland next year to visit my parents, and now having an extra $300 a week that used to go towards the flat will help go towards that.”
But Mr Davies and his friends aren’t alone in embracing the COVID exodus, with new research from comparison site finder.com.au revealing one in five Aussies have moved house or are considering moving in 2020.
That’s the equivalent of 3.8 million of us who are pulling up stumps on our pre-COVID abode – and it’s well worth the effort, with Finder analysis of SQM Research data showing renters now stand to save $3640 a year on average by moving to a cheaper rental property.
Finder personal finance expert Kate Browne said the pandemic had accelerated many people’s moving plans.
“Millions of Australians are questioning what’s important to them and whether their current accommodation still meets their needs,” she said.
“Living close to the office might be less important – while open space and local amenities might rank more highly.
“Thanks to the cloud over the rental market, it’s a good time to find a bargain.”
And there’s plenty more evidence to prove renters are now in a position of power, with the most recent CoreLogic data revealing capital city dwelling rents are down 1.4 per cent overall since the end of March.
In that period house rents have fallen 0.3 per cent while unit rents have dropped by a far more substantial 3.5 per cent – and a whopping 5.1 per cent in Hobart.
CoreLogic’s head of research, Tim Lawless, said weaker rental conditions across the unit sector were the result of a combination of high supply and low demand.
“Supply levels for rental grade units have surged over recent years, especially in Sydney and Melbourne, where high-rise unit supply across key inner city markets has remained substantially above average,” he said.
“At the end of March there remained around 51,000 units under construction across NSW … and about 45,000 units were under construction across Victoria.
“On the demand side, rental demand for inner city apartments has been significantly impacted by stalled overseas migration, including foreign students, as well as less demand from domestic students who are generally studying from home.
“Rental demand has also been impacted by weak labour market conditions across industry sectors common with renters, including the food, accommodation, arts and recreational services sectors.”
CoreLogic rental listings data shows advertised rentals in certain inner city areas had more than doubled between mid-March and early August – a trend that was “likely to persist, at least until international borders reopen”.
Realestate.com.au chief economist Nerida Conisbee told news.com.au she had never seen such disruption in the rental market – and that there had never been “so much power in renters’ hands”.
“Generally we’ve seen much more power with landlords, but that has really switched around since COVID hit,” she said.
“In areas where there are a lot of vacancies some landlords are having to throw in incentives like weeks of free rent which has been interesting to see.”
Ms Conisbee said the trend was “definitely happening” but that renters were able to get better deals in certain locations.
They include inner city areas where there has been the biggest uptick in apartment rental listings such as the Sydney CBD, Erskineville, Macquarie Park, Schofield and Rhodes, and the Melbourne CBD, Southland and Docklands.
“Early on in the pandemic it was a really good time to get a bargain, but everyone was scrambling and very nervous about the future,” Ms Conisbee explained.
“But there are still good deals to be had across Australia, primarily because foreign students have not returned and have left a lot of vacant apartments.”
Ms Conisbee said with tertiary education going online during the pandemic, many local students had also moved back home to save cash if their families lived nearby – a trend exacerbated by job losses in the retail and hospitality industries which tend to employ more young people, who were also more likely to rent.
“There’s a bit of an intergenerational issue at the moment and the rental market has been really disturbed,” she said.
If you’re a renter, Ms Conisbee said the first step was to do your research on average rents in your area and then contact your landlord to try and negotiate a rent reduction.
Failing that, she urged people to consider moving to areas that had seen the biggest increase in listing volumes where landlords might be “more prepared to strike a deal”.