Over the quarter unit rents have increased by 3.1%, while house rents have grown by 2%.

Currently, vacancy rates for units in Adelaide are also at their lowest in the country, sitting at 0.3% as of June. This low availability, combined with increased demand, suggests that rents will continue to rise, narrowing the affordability gap between houses and units.

While this trend poses challenges for renters, it presents an appealing opportunity for investors, particularly due to the significant difference in rental yields. Units provide an attractive yield of 5.25%, surpassing the moderate yield of 3.88% offered by houses.

This notable variance in yields stems directly from the distinct affordability advantage that units offer over houses. After reaching a peak in April, the median unit price in Adelaide is $444,157, in contrast, average house value is currently $663,136. With a lower price point to enter the market and higher returns, we expect to see savvy investors who are chasing positive cash flow to make the most of this opportunity.