Shepparton’s big rental squeeze

UNPRECEDENTED DEMAND... Shepparton Real Estate managing director, Ryan O'Connor, is seeing massive demand for rental properties in the region. Photo: Stephanie Holliday

THE Shepparton rental market has encountered unprecedented growth in recent months, with demand far outstripping supply.

The exodus from metro Melbourne to regional and coastal regions last year has put further strain on areas where affordable rental options were already scarce.     Continued page 5
Last month, more than a quarter (26.1 percent) of all Melbourne houses and apartments listed for rent had had their asking price reduced, up from 14.9 percent in November last year.

In contrast, every region outside Melbourne, including Shepparton, Bendigo, Ballarat, Geelong and the Latrobe Valley, has seen a significant drop in the proportion of advertised rental properties being discounted.
Shepparton Real Estate managing director, Ryan O’Connor, said his property management team can’t keep up with the demand, with them fielding up to 40-50 applications per rental property.

“Traditionally here we have a high yield market but a lower capital growth rate, at the moment though we are seeing a 10 percent capital growth rate and 6.5 – 7 percent yield, far higher than it’s been in years” said Mr O’Connor.

“Up to a quarter of prospective tenants are not from the region, whether they be from metro Melbourne or other regional areas, employment prospects in Greater Shepparton have been a major factor in the influx of people who are non-locals seeking rental accommodation.”
Out of the 850 properties on Shepparton Real Estate’s rent roll, only one is currently vacant.

Another driving force behind the disparity between vacant properties and prospective tenants is the inundation of Melbourne-based investors who have seen the demand in regional areas for rentals raise exponentially compared to back home.