New analysis of the state's real estate markets has placed three Launceston suburbs among 10 statewide where rents are anticipated to increase significantly over the next year.
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The latest Hood Tenant Report released this week revealed rents in Invermay rose by $90 a week over a 12-month period up until January and that the suburb had one state's lowest rental vacancy rates of 1 per cent.
Next was Newstead with a rent increase of $90 over the year and South Launceston with a $80 per week rent increase and a vacancy rate of 0.7 per cent.
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The median rent in South Launceston was $440 and $480 in Newstead.
The median rent in Invermay was $350.
If more tenants want to live in an area, that leads to increased demand for rental properties, which puts upward pressure on rental rates.
- Hood chief executive Tom Fraser
Hood chief executive Tom Fraser said high demand for rentals pushed rental rates in a particular suburb up.
"Ever since the pandemic started, people have taken a greater interest in where they live, both in terms of the location and the type of property," he said.
"If more tenants want to live in an area, that leads to increased demand for rental properties, which puts upward pressure on rental rates."
While no North-West suburbs were on the top 10 list for highest rent rises and lowest vacancy rates, Burnie First National managing director Deanne Lamprey said parts of the region had rent increases of 50 per cent over 12 months.
She said cheaper rental properties had been sold off by investors over the COVID-19 pandemic due to gradually lower returns which had in turn reduced supply in the market.
In addition, Ms Lamprey said landlords who had been prevented from increasing rent in 2020 and 2021 had decided to make up for it when they were able to.
She said the issue of rental supply was such a problem that 75 per cent of rental applicants were turned down by her office each week.
A three-bedroom home in the North-West costs $350 on average to rent per week.
A three-bedroom home in Launceston costs $420 on average to rent each week and $500 in Hobart.
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