The economic downturn has put a lid on house rent rises and renters are likely to benefit for some time, a new report says.

Australian Property Monitors (APM) economist Matthew Bell said house rents stalled in June, in the most significant shift in the rental market since the data was first collated in 2005.

The APM’s rental series for the June quarter reported zero growth in asking rents for all the capitals except Canberra.

“Rental growth has stopped dead in its tracks across the country as the effects of a weakening employment market and an increase in alternative ownership options have left renters much less willing to accept any further increases in weekly rents,” Mr Bell said.

“The first six months of 2009 has seen the market turn in favour of renters.

“The absence of any rental growth in the June quarter across major capitals follows a noticeable slowing in the rate of increase in the March quarter.”

Canberra was the only city to post growth in rent for houses in the quarter, up 1.2 per cent, while the weekly rents for houses on the Sunshine Coast fell of 1.3 per cent.

In annual terms, rental growth for houses was highest in Darwin, up 11.1 per cent to June 30, and a 7.1 per cent rise in Sydney due to firm increases in 2008.

Melbourne, the Gold Coast and the Sunshine Coast posted zero rental growth in houses over the year.

The median weekly rent for a house in Darwin was $500, $450 in Sydney and $415 for Canberra.

Mr Bell said low mortgage costs for landlords and a rise in the jobless rate, which reduces the ability of renters to afford increases, have helped put a lid on rents.

“With unemployment forecast to continue rising well into 2010, the First Home Owners Boost in place until December, and variable interest rates predicted to fall by another 0.5 percentage points, the market is expected to favour renters for some time,” Mr Bell said.

Units in Darwin had a median weekly rent of $430 and the city had the strongest growth, up 7.5 per cent in the quarter and rising 22.9 per cent over the year.

Median weekly rents for both houses and units in Darwin were the most expensive in Australia, the report said.

“This is due to a much more resilient employment market which, in turn, is underpinned by strong infrastructure spending by the private sector and the federal government in the Territory,” Mr Bell said.