Rents have risen strongly across the nation, due mainly to a shortage of new homes. This is a healthy sign for investors but not so for renters. Rents are likely to increase further, as many landlords will be looking to recoup some of the increased interest costs resulting from the latest rate hike.
Improving yields and accelerating population growth will keep upward pressure on house prices in the future. Last year Australia’s population grew by over 300,000 people, the largest growth in absolute numbers ever recorded. We expect solid rental growth in 2008.

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