National rental growth sluggish: CoreLogic RP Data

House and apartment rents are growing for landlords at the slowest pace since at least 1995 - and actually fell in July - according to CoreLogic RP Data.

Tim Lawless, CoreLogic's head of research, described rental appreciation was sluggish, on average less than 1 per cent a year, due to the boom currently underway in dwelling construction along with record participation in housing by investors, both domestic and foreign purchasers.

Rental rates fell by 0.3% in July 2015 across the combined capital cities.

The current annual rate of rental appreciation has reached a new record low of 0.9% and is continuing to trend lower.

Sydney and Hobart recorded the greatest increases in weekly rents.

Dwelling rental rates across the combined capital cities are sitting at $486 per week after they fell by 0.3% over the month of July.

However, weekly rents are up by 0.3% over the first seven months of the year and have increased by just 0.9% over the past 12 months.

At a combined capital city level, gross rental yields were recorded at 3.4% for houses in July 2015 and at 4.3% for units while house rents are currently at a record low level.

One year ago, gross rental yields were recorded at 3.8% for houses and 4.6% for units across the combined capitals.

“With capital growth likely to continue outpacing rental growth, we expect that rental returns could push even lower over the coming months. From an investment perspective it means that capital growth is going to be much more important for a return on investment,” Tim Lawless said.

CoreLogic RP Data started its rental statistical collection in 1995.