Capital city rental rates have increased by just 1.8% over the 12 months to October 2014, slumping to their lowest annual increase since August 2003

Capital city rental rates have increased by just 1.8% over the 12 months to October 2014, slumping to their lowest annual increase since August 2003. Yields also continue to soften as home value growth outpaces rental growth. With first home buyers at a record low level of market participation and new housing supply at quite high levels it is no wonder rental pressures are easing. In fact with so many new inner city units being built I expect that rental growth will most likely slow even further over the coming months which may also lead to even lower gross rental yields.