Savills releases its Australia Build to Rent Market Update for Q3 2022, highlighting exponential growth. Build to Rent stock in Australia currently stands at 3,800 units, with an additional 8,400 units under construction. Including Build to Rent at the application stage, the current future pipeline is 22,500 units, with 15,400 units expected to complete by 2024.
Some key highlights from the report include:
- The number of investors targeting Australian Build to Rent has grown exponentially over the past 18 months, with over $3.5bn raised and committed to the sector since January 2021.
- For policy makers, there is also a growing understanding that the delivery of Build to Rent can help act as a balance to the enraging story of housing deficit, stimulate new housing development and help counter rising rents.
- With projections for the formation of smaller households to continue, and immigration increasing, alongside the return of over 282,000 international students in the seven months since early December, record low vacancy rates are forecast to remain lower for longer.
- The yield stability currently being referenced across Australian Build to Rent reinforces how investors are attracted to the sector for the long-term income streams it generates.
- Inflation rate is one factor which has a direct relation to interest rates. Residential rental property prices tend to move in line with inflation, so rental property is a great hedge against inflation.