Tenement rate at record low in the Bayard Street Tenement

Tenement rates in the historic Tenement District of Melbourne have dropped by almost 50 per cent in the past five years, the Victorian Government said.

A spokesperson for the Department of Planning and Local Government said that during the five-year period to March 2019, the rate fell by 12.8 per cent, or $1.5 million.

In the four years before that, the average rate was a little over $2 million, the spokesperson said.

The rate was also at a record low last year, with the rate falling to $1,250 a week, according to the Victorian Department of Primary Industries.

The spokesperson said the rate drop in Melbourne was driven by “higher house prices, which have not yet reached the level that the economy is projecting”.

“The average rent in Melbourne has fallen by almost half in the last five years,” she said.

“This is an important reminder that affordability remains a challenge in the Victorian economy, with more than 80 per cent of households now paying below the average rent.”

Ms Scott said the change in the average price was “very welcome” but said the increase was not expected to last.

“The rate will continue to drop over time,” she told AM.

“The government has taken steps to encourage residents to rent, so we are continuing to work with our community to help them find affordable accommodation.”

Ms Dickson said the number of properties in the area that were at risk of being sold to foreign investors was “significant” and there was a need for a stronger and more effective community rental sector.

“We are doing all we can to support the local community,” she wrote in a statement.

Ms Scott acknowledged that the rate in the neighbourhood had fallen in the previous five years and said the average rental rate had also dropped, but the difference between that and the average cost of living had remained the same.

“It’s still a low rate and the median cost of rent in the city is around $1 per week,” she explained.

“But the average home price is actually much higher in the market than the average median rent is.”

The reason for that is that there is so much more available housing in the Melbourne market than in the CBD.

“In some areas, like North Melbourne, it is still cheaper to rent than it is to buy.”

Ms Tynan said she hoped the changes to the rental market would result in a “great return on investment”.

“It will be a huge relief for people who have been struggling for rent, as they will be able to stay in their homes longer, which will result in them saving more and will be more affordable for them to do so,” she noted.

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