LGACARRISTS stocks are up on Monday as a new report shows that car rental prices in Melbourne are rebounding from last year’s collapse.
A new report by research company Trulia showed car rental stocks in Melbourne have risen by almost 20 per cent since November’s record high of $1,829.
The average rental price in Melbourne has also risen by nearly 5 per cent in the last 12 months.
The stock market has rallied almost $1.3 trillion since the market crash of 2007, with many experts saying that was due to the stock market’s soaring returns from 2008 to 2010.
While the market’s rise was initially driven by an over-supply of stocks, analysts are now forecasting an oversupply once more.LGACARTRIES stock rose more than 7 per cent this year.
However, as the markets rally, many investors are now predicting a correction.
“We have seen a dramatic increase in the number of rental properties being listed, which suggests that the rental market is under pressure,” said the research firm’s chief economist, John Kavulich.
“There is also a lot of speculation around the future of rental stocks due to concerns over a potential market correction.”
The rental market’s recovery has been helped by strong demand from the mining industry.
Trulia also forecast a strong rebound in car rental stock in the future, predicting that car prices will continue to rise.
The company also said that car leasing companies were continuing to recruit and expand in order to keep up with demand.
“Although there are some signs of a return to a more normal rental market, rental rates are still falling at a faster pace than the stock markets,” said Kavuli.
LGA car rental is also up by around 6 per cent, according to Trulia, with most of the gains coming from luxury cars.