Warrnambool tops the list of most expensive regional Victorian city when it comes to renting a house, new data shows.
Renters are paying $350 a week for a house, a jump of 6.1 per cent on last year, according to the Domain rental report on median rental prices for the March quarter.
While rental prices have risen 16.7 over the past decade, the recent spike follows a tightening in the rental market which is at 1.2 per cent - half what it was a year ago.
Renters in Wodonga were also paying $350 a week for a rental property, while other major regional centres were up to $40 a week cheaper.
The median price for a rental in Ballarat was $330, Bendigo $320, Shepparton $310 and Mildura $320. Rents in Geelong and along the surf coasts were higher.
Falk and Co sale manager Gary Attrill said there were very minimal properties for rent and with new regulations expected to come in he predicted things would only get more difficult.
"Usually at this time of the year we've got a fair few vacancies coming into winter. Right now we might have 10 or so on our books," he said.
Mr Attrill said negative gearing and capital gains changes proposed by a Bill Shorten-led Labor government would affect investments.
"We've had a lot of investors sell recently," he said.
"I think they're nervous about what's coming."
He said tenants living in rental properties that have sold have found it hard to find somewhere else to live, forcing some house settlements to be delayed. "It snowballs a bit," he said.
If it keeps going at this rate... it's going to force the prices to go up.Falk and Co sale manager Gary Attrill
Mr Attrill said tenants were having to wait months to find somewhere to live.
He said that as rents had risen, some tenants have found it was cheaper to purchase a property rather than stay in the rental market.
He the demand had not dropped off with open houses still attracting up to 20 prospective tenants.
He and Ludeman Real Estate director Mark Dwyer said they were not having trouble selling houses because there was a bit of a shortage at the moment.
"The rental market is tight. It's not going to change. It just seems to be not enough supply for the demand," he said.
"As far as the sales side of things, I think it's probably going to have a bit to do with who gets elected.
"I think the investors who are the main ones putting their properties on the market, running a bit scared which I think is probably going to work in reverse."
"If it keeps going at this rate... it's going to force the prices to go up."
He said the median house price in Warrnambool had risen recently. Real Estate Institute of Victoria figures show the median house price in the march quarter was $338,000 .
Mr Dwyer welcomed the Liberal Party promise, which Labor had promised to match, which would help first homebuyers get into the market.
"The banks have made it hard enough on first homebuyers, so any government incentive to help first home buyers get in the market, as a real estate agent, we're 100 per cent for it," he said.
"I don't know if it's going to solve any great problems whichever gets in. I don't see it's going to affect the market. It's possibly could affect the investment market. I don't think it's going to work in favour of the tennant which a lot of people think it will.
"I think it's going to go the other way."
PM Scott Morrison announced a plan to slash the amount of money needed for home loan deposits.
Member for Wannon Dan Tehan said that from January 1 next year, a re-elected Morrison Government would give first home buyers the chance to get into the market with a deposit of five per cent and without the need to take out expensive mortgage insurance, through a First Home Loan Deposit Scheme.
The loans would be supported by the National Housing Finance and Investment Corporation which would allow lenders to offer loans they would otherwise turn down, or that would require lenders mortgage insurance.
The scheme will be available to first-home buyers with an income of up to $125,000, or $200,000 for a couple who are both first home buyers.
Mr Tehan said it would mean first-home buyers would only need to save a $30,000 deposit rather than $120,000 for a $600,000 property.
The scheme would be capped to a house price value determined on a regional basis, reflecting the different property markets across Australia, he said.
Mr Tehan said experts had estimated that Labor's "$32m housing tax" would result in house prices falling by as much as 16 per cent and drive rents up as much as 22 per cent.
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