According to one property expert, lower interest rates and improved housing affordability have given renters more options.
Rents have levelled of for the March quarter, nationwide according to data from Australian Property monitors.
Economist Matthew Bell from Australian Property Monitors says rental yields are now approaching or exceeding mortgage rates in some areas, which could provide some stimulus for potential investors to re-enter the market.
[It] gives people a real alternative if the rental increases are going to make them pay more than they would on a mortgage," he said.
But he says with an undersupply of housing and economic uncertainty, this may not last long.
"It's going to take more than a flat quarter or two of rents to really put it in renters' favour," he said.
The rental squeeze in NSW has eased recently with the highest number of vacant rental properties since mid-2007 being recorded in Sydney's west earlier this year.
BIS Shrapnel's residential property analyst Jason Anderson believes the conditions are good for homebuyers and this is encouraging more people out of rented accommodation into their own home.
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