Data from Suburbtrends also credited scores for public transport accessibility and lifestyle, resulting in a ranking of the top 10 SA2s in Australia with the most promising potential for Build to Rent businesses.
The data focusses on market inventory levels for houses and units, median rents, vacancy rates, and rental affordability (calculated as the percentage of household income allocated to rents) up to February this year.
The Australian Bureau of Statistics (ABS) data covers total dwellings by property type, building approvals over a 24-month period ending in 2021, socio-economic indicators based on SEIFA scores, unemployment rates as of December 2022, rental tenure, and household income as of the August 2021 census.
Artificial Intelligence (AI) platform ChatGPT was utilised by Suburbtrends during the research process, for a variety of reasons. ChatGPT processes large amounts of data quickly, allowing for more efficient analysis and modelling.
Top 10 SA2s for Build to Rent potential exhibited the following characteristics
- Low building approvals for units: less than 2% new pipeline supply based on 2-year approval totals.
- Moderate to low inventory: Maximum of five months inventory with an average of less than two months.
- High socio-economic ranking: nine out of 10 areas ranked in the top 10% for socio-economic advantage, with one having a ranking of nine.
- Low unemployment: maximum of 2% unemployment.
- High rental tenure: minimum of 20% rental tenure.
- Low vacancy rate: maximum of 1.5% vacancy rate.
- Affordability: high income levels, with a maximum of 26% allocated to renting apartments.
- Accessibility: minimum transport score of six, ensuring good access to public transport.
- Quality lifestyle: minimum lifestyle score of seven, ensuring access to local amenities.
This comprehensive analysis resulted in Suburbtrends creating a ranking of the top 10 SA2s in Australia with the most promising potential for Build to Rent.
Top 10 promising locations for Build to Rent in Australia
Paddington-Moore Park
The Paddington-Moore Park Statistical Area (SA2) is situated in Eastern Suburbs-North (SA3) within the Sydney-Eastern Suburbs region (SA4). Based on Census data, the area features 454 houses, 3,438 townhomes, and 2,577 units.
Recent building approvals, as a percentage of established housing stock, is a low 1.1% rate for houses, and no approvals for townhomes and units. The current inventory stands at 1.52 months of stock for houses and 0.8 months for units.
Notable socio-economic factors include a median household income of $2,810, a top socio-economic ranking of 10, and a low unemployment rate of 1.8%.
A total of 46% of the residents rent, and the area boasts a low vacancy rate of 1.09%. Median rents in Paddington-Moore Park are $1,250 for houses and $500 for units. Unit rental affordability is excellent, with 18% of income allocated to rent.
Contributing to the area’s desirability for Build to Rent projects are a transport score of eight and a lifestyle score of eight, showcasing the excellent connectivity and vibrant lifestyle options available for residents.
Balgowlah-Clontarf-Seaforth
The Balgowlah-Clontarf-Seaforth Statistical Area (SA2) is situated in Manly (SA3) within the Sydney-Northern Beaches region (SA4). Based on Census data, the area features 4,601 houses, 968 townhomes, and 1,389 units.
Recent building approvals, as a percentage of established housing stock, stand at 1.7% for houses, 2.2% for townhomes, and 1.6% for units. The current inventory is 1.11 months of stock for houses and 1.33 months for units.
Notable socio-economic factors include a median household income of $3,409, a top socio-economic ranking of 10, and a low unemployment rate of 1.9%.
A total of 21% of the residents rent, and the area boasts a low vacancy rate of 1.05%. Median rents in Balgowlah-Clontarf-Seaforth are $1,595 for houses and $650 for units. Unit rental affordability is excellent, with 19% of income allocated to rent.
A transport score of six and a lifestyle score of eight showcases good connectivity and vibrant lifestyle options.
Balmain
The Balmain Statistical Area (SA2) is situated in Leichhardt (SA3) within the Sydney-Inner West region (SA4). Based on Census data, the area features 1,459 houses, 2,831 townhomes, and 2,220 units.
Recent building approvals, as a percentage of established housing stock, stand at 1.8% for houses, 0.6% for townhomes, and 0.0% for units. The current inventory is 0.99 months of stock for houses and 1.36 months for units.
Notable socio-economic factors include a median household income of $3,149, a top socio-economic ranking of ten, and a low unemployment rate of 1.9%.
A total of 39% of the residents rent, and the area boasts a low vacancy rate of 0.75%. Median rents in Balmain are $950 for houses and $650 for units. Unit rental affordability is excellent, with 21% of income allocated to rent.
A transport score of seven and a lifestyle score of eight showcases good connectivity and vibrant lifestyle options.
East Melbourne
The East Melbourne Statistical Area (SA2) is situated in Melbourne City (SA3) within the Melbourne-Inner region (SA4). Based on Census data, the area features 77 houses, 538 townhomes, and 1,762 units.
Recent building approvals, as a percentage of established housing stock, stand at 2.6% for houses, 0.6% for townhomes, and 0.0% for units. The current inventory is 4.36 months of stock for houses and 4.97 months for units.
Notable socio-economic factors include a median household income of $2,345, a top socio-economic ranking of ten, and a low unemployment rate of 1.8%.
A total of 53% of the residents rent, and the area boasts a low vacancy rate of 1.41%. Median rents in East Melbourne are $900 for houses and $500 for units. Unit rental affordability is excellent, with 21% of income allocated to rent.
A transport score of ten and a lifestyle score of nine showcases good connectivity and vibrant lifestyle options.
Drummoyne-Rodd Point
The Drummoyne-Rodd Point Statistical Area (SA2) is situated in Canada Bay (SA3) within the Sydney-Inner West region (SA4). Based on Census data, the area features 3,173 houses, 697 townhomes, and 3,228 units.
Recent building approvals, as a percentage of established housing stock, stand at 1.8% for houses, 2.9% for townhomes, and 1.5% for units. The current inventory is 1.15 months of stock for houses and 1.66 months for units.
Notable socio-economic factors include a median household income of $2,754, a top socio-economic ranking of ten, and a low unemployment rate of 1.3%.
A total of 32% of the residents rent, and the area boasts a low vacancy rate of 0.87%. Median rents in Drummoyne-Rodd Point are $950 for houses and $620 for units. Unit rental affordability is excellent, with 23% of income allocated to rent.
A transport score of seven and a lifestyle score of seven showcases good connectivity and vibrant lifestyle options.
Crows Nest-Waverton
The Crows Nest-Waverton Statistical Area (SA2) is situated in North Sydney-Mosman (SA3) within the Sydney-North Sydney and Hornsby region (SA4). Based on Census data, the area features 822 houses, 1,706 townhomes, and 5,815 units.
Recent building approvals, as a percentage of established housing stock, stand at 0.1% for houses, 0.9% for townhomes, and 0.6% for units. The current inventory is 1.54 months of stock for houses and 2.02 months for units.
Notable socio-economic factors include a median household income of $2,615, a top socio-economic ranking of 10, and a low unemployment rate of 2%.
A total of 50% of the residents rent, and the area boasts a low vacancy rate of 1.12%. Median rents in Crows Nest-Waverton are $1,075 for houses and $590 for units. Unit rental affordability is excellent, with 23% of income allocated to rent.
A transport score of seven and a lifestyle score of seven showcases good connectivity and vibrant lifestyle options.
Cremorne-Cammeray
The Cremorne-Cammeray Statistical Area (SA2) is situated in North Sydney-Mosman (SA3) within the Sydney-North Sydney and Hornsby region (SA4). Based on Census data, the area features 1,712 houses, 972 townhomes, and 5,686 units.
Recent building approvals, as a percentage of established housing stock, stand at 0.4% for houses, 1.3% for townhomes, and 0.4% for units. The current inventory is 1.97 months of stock for houses and 1.31 months for units.
Notable socio-economic factors include a median household income of $2,689, a top socio-economic ranking of 10 and a low unemployment rate of 1.8%.
A total of 43% of the residents rent, and the area boasts a low vacancy rate of 1.12%. Median rents in Cremorne-Cammeray are $1,200 for houses and $650 for units. Unit rental affordability is excellent, with 24% of income allocated to rent.
A transport score of seven and a lifestyle score of eight showcases good connectivity and vibrant lifestyle options.
Bondi Beach-North Bondi
The Bondi Beach-North Bondi Statistical Area (SA2) is situated in Eastern Suburbs-North (SA3) within the Sydney-Eastern Suburbs region (SA4). Based on Census data, the area features 848 houses, 1,447 townhomes, and 6,222 units.
Recent building approvals, as a percentage of established housing stock, stand at 2.7% for houses, 0.7% for townhomes, and 1.1% for units. The current inventory is 1.82 months of stock for houses and 1.39 months for units.
Notable socio-economic factors include a median household income of $3,013, a top socio-economic ranking of 10, and a low unemployment rate of 2%.
A total of 57% of the residents rent, and the area boasts a low vacancy rate of 1.22%. Median rents in Bondi Beach-North Bondi are $1,550 for houses and $775 for units. Unit rental affordability is excellent, with 26% of income allocated to rent.
A transport score of nine and a lifestyle score of nine showcases good connectivity and vibrant lifestyle options.
Bondi-Tamarama-Bronte
The Bondi-Tamarama-Bronte Statistical Area (SA2) is situated in Eastern Suburbs-North (SA3) within the Sydney-Eastern Suburbs region (SA4). Based on Census data, the area features 1225 houses, 1118 townhomes, and 5208 units.
Recent building approvals, as a percentage of established housing stock, stand at 1.4% for houses, 1.0% for townhomes, and 1.0% for units. The current inventory is 1.76 months of stock for houses and 0.91 months for units.
Notable socio-economic factors include a median household income of $2,951, a top socio-economic ranking of ten, and a low unemployment rate of 1.7%.
A total of 50% of the residents rent, and the area boasts a low vacancy rate of 1.06%. Median rents in Bondi-Tamarama-Bronte are $1,595 for houses and $770 for units. Unit rental affordability is excellent, with 26% of income allocated to rent.
A transport score of nine and a lifestyle score of nine showcases good connectivity and vibrant lifestyle options.
