Rising interest rates and higher costs associated with managing an investment property are driving up rental prices, according to Warrnambool real estate agent David Falk.
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The Falk and Co director said he knew of investors whose mortgages had increased from about $1300 a month to almost $2500 since 2020.
And that's an investor who is only paying the interest on the loan, Mr Falk said.
He said this spike, along with new statutory requirements of landlords that had added to upkeep costs, was making an investment property a less attractive prospect for some owners.
"I think it's everything put together that's seeing the cost of rentals go up," Mr Falk said.
He said he was seeing investors who had property portfolios for decades exiting the market.
"A lot of these people have been landlords for a very long time," Mr Falk said.
Mr Falk said some landlords had also become tired of a lack of respect to their property by tenants.
"I think agents are trying to keep the rental costs steady but it is hard when you have all these costs associated with these properties," he said.
Mr Falk said he only had a small number of rental properties which were currently vacant.
His comments come after The Standard revealed last week the cost of rent in Warrnambool had risen by 42.9 per cent in five years.
The data showed the average rental cost increased by 6.38 per cent in the last 12 months from $470 to $500.
It also shows the average cost of a rental in the city was $350 in March 2019.
State government data also shows there are more than 1200 people on the wait for social housing in Warrnambool.
This was the number as at December 2023.
Warrnambool and the south-west are in the grips of a rental crisis, with a growing number of people forced to live in motels.
Member for Western Victoria Sarah Mansfield has renewed calls for tighter restrictions on short-stay properties to address the housing crisis.
"People who grew up in Warrnambool are being forced to leave their community because of the lack of rental housing," she said.
"Airbnb and other short-term rentals are part of the problem, driving up house prices and turning homes into hotels.
"The Greens believe that everyone has the right to secure, affordable housing - including in their home town."
Monique Patterson
I'm a journalist with more than 15 years experience. I currently work at The Standard in Warrnambool. If you have anything to add to this story please contact me at mpatterson@warrnamboolstandard.com.au
I'm a journalist with more than 15 years experience. I currently work at The Standard in Warrnambool. If you have anything to add to this story please contact me at mpatterson@warrnamboolstandard.com.au
