Australian capital city rents up 13% over year as further hikes predicted for 2024 amid housing shortage
Australia’s record shortage of rental properties will continue to drive prices up for tenants, analysts say, with a new report revealing combined capital city rents rose 13.2% year-on-year.
Data from PropTrack, the property analytics division of REA Group, has revealed national rental prices rose 11.5% over the past year, with combined capital city rents up 13.2% to an average of $600 a week, driven by large increases in Sydney, melbourne and Perth.
“Maybe the small silver lining, the small comfort to renters, is it is a bit slower than what we saw the previous year, in 2022, when we saw growth just shy of 18%,” the PropTrack senior economist Angus Moore said.
“So there are some signs that things, at least in some parts of the country, are starting to slow down.
“But we’re still seeing very strong growth in places like Perth, Sydney and Melbourne. So we’re far from out of the woods for renters.”
Median advertised rents nationally rose 1.8% over the December quarter to $580 a week, bringing rents up 11.5%, or $60 a week, compared with a year ago.
“No matter how you cut it, that’s extremely quick growth in rents,” Moore said.
Units in Sydney, Melbourne and brisbane had seen particularly sharp increases in the past year, he said, with median prices rising 17.2%, 15.6% and 16.7% respectively.
Perth has seen the fastest rental growth over the past year, with median advertised rents for dwellings up 20%. Compared with pre-pandemic prices, median advertised rents in Western Australia’s capital are up 66%, as the city now has the second lowest vacancy rate in the country, behind Adelaide.
Moore said January was often the busiest time for the market and rents were expected to continue to climb, albeit at a slower pace, across the year.
“As we head into that period, we’re still looking at very low availability,” he said.
“Rents have been growing very quickly, and we would expect that to continue in at least the near term.”
In contrast, regional rental markets had seen more moderate growth, he said. Rents were flat across regional areas in the December quarter and had been stable at $500 a week since June.
The Everybody’s Home spokesperson, Maiy Azize, said high rents showed the private sector had failed to deliver affordable housing.
“This increase is just the latest blow to renters,” she said. “Rents have been going up by extraordinary amounts every year, and there is only so much that people can afford to pay.”
Azize called on the federal government to “work with states to put limits on rent increases”.
“Countries all over the world use rent controls to protect people from unfair increases,” she said. “It’s time for Australia to catch up.”
