‘A more relaxed lifestyle’: Regional Victorian towns where rents jumped most

Rents have jumped in a string of popular regional Victorian towns in the past year, driven by their lower cost of living, desirable lifestyle and job opportunities.

The local government areas that recorded the biggest increases in median asking rents were the Macedon Ranges (up 13.2 per cent), Shepparton (up 11.9 per cent), Mildura and Mansfield (both up 10 per cent), and Murrindindi (up 9.8 per cent), the latest Rent Report from property listings site Domain has revealed.

Domain chief of research and economics Dr Nicola Powell said renters were influenced by affordability constraints when looking for a home.

“We have seen house rents flat-line over the quarter, but unit rents have risen, so it looks like there is more momentum for units rather than houses, which says a lot about affordability.”

Across regional Victoria overall, asking rents for houses were steady in the September quarter at a median of $470 per week, while unit rents rose $5 a week to $370.

Another contributing factor to Victoria’s rent rises was the change in population dynamics in the state, which, for the first time since September 2021, saw positive net migration.

“I can’t stress how big of a change this is,” Powell said.

“What we have now is population dynamics are reverting to what we would normally see for the state of Victoria. And what we will likely see is a positive rate of growth in prices and demand for rentals.”

Powell said the exodus of landlords within many Victorian local government areas had also played a role in rising rents and will continue to do so.

She said the shortage of rental properties, fuelled by investors leaving the market because of land tax increases and concerns about rental regulation changes, was further driving up rents.

The Macedon Ranges council area recorded the largest jump in rents in regional Victoria.

KPMG director of planning and infrastructure economics Terry Rawnsley said strong regional economies played a significant role in the rental demand of these local government areas.

“Some of the regional areas like Mildura and Shepparton have good local economies coming through there, and it should be a relatively good year for agricultural production which brings in a lot of supporting workers,” he said.

In other areas, especially those within commuting distance of Melbourne, Rawnsley said affordability was a big driver.

“The Macedon Ranges corridor may appeal to those who have been priced out of Melbourne and are looking further afield, as well as those seeking space and affordability.”

Jellis Craig Central Victoria senior property manager Jane Vella said the rental market in the Macedon Ranges was very competitive.

“Demand for rentals has been on the rise, particularly due to the area’s proximity to Melbourne, which makes it attractive to those seeking a more relaxed, semi-rural lifestyle while still maintaining access to the city,” she said.

A limited supply of available rental properties had also put upward pressure on rental prices, which were at a high after lockdown due to the majority of applicants moving away from Melbourne, she said.

“The demand far exceeds the supply, especially for well-maintained properties in desirable locations with some land. For many properties, it is common to receive multiple applications within the first few days of listing.”

Vella said the area was attracting a broad mix of renters, including families, professionals and those seeking a tree-change lifestyle.

“We are also seeing interest from other regional areas and interstate renters, particularly from cities like Sydney,” she said.

“The appeal of the Macedon Ranges includes its proximity to Melbourne but also the lifestyle benefits such as access to nature, good schools and a strong sense of community.

“The area offers a blend of rural charm and modern conveniences, which makes it an attractive option for those looking to escape urban density without sacrificing amenities.”

Meanwhile, Shepparton Real Estate managing director Ryan O’Connor said it was job opportunities that were attracting renters to the greater Shepparton area.

“We aren’t seeing many applicants from Melburnians, but we are seeing plenty of applications from internationals moving here to work in the hospitals, factories and farms,” he said.

O’Connor said this was also creating a competitive rental market with any rental property under $450 receiving a lot of interest.

“At present, we are averaging somewhere between 30 to 40 rental applications per property. We had a two-bedroom unit and have 22 inspections and 60 applications this week alone,” O’Connor said.