Perth passes Sydney to claim title of least affordable capital for renters
Perth is now the least affordable capital city to rent in, with low-income earners bearing the brunt of the crisis, according to a new report released on Friday.
The tenth annual National Shelter-SGS Economics and Planning Rental Affordability Index, which compares average rents to incomes, found Perth’s rental affordability dropped 13 per cent in the past year, making it less affordable than Sydney for the first time.
Perth has been deemed critically unaffordable for many.Credit: Supplied
Affordability in regional WA has also hit an all-time low as incomes failed to keep pace with rent increases over the past four years.
The situation is most dire for low-income renters with single JobSeeker incomes and pensioners, for whom Perth and regional WA is classed as “critically unaffordable”.
For part-time workers receiving a parenting payment, Perth is “critically unaffordable” and the rest of WA “extremely unaffordable”.
Shelter WA chief executive Kath Snell said for single hospitality workers, the whole state was “severely unaffordable”.
“Families who have never experienced homelessness before are sleeping in cars and tents because they cannot afford the rent,” she said.
“The rental market is out of control and needs to be fixed fast. Not only is WA the worst in the country for rental affordability, WA lags behind most states and territories when it comes to rental standards and protections.”
The peak body has proposed the creation of a WA Affordable Rental Housing Scheme to incentivise urgently needed new affordable rental supply, and a WA Housing Future Fund, which would ensure a portion of the state’s surplus was permanently invested in social and affordable housing.
With the state election just months away, Shelter WA called on all parties to back its election priorities, including committing to adding at least 5000 social and affordable homes to WA’s housing stock every year.
Perth’s median rent is $650 a week.Credit: Ross Swanborough
Shelter WA’s analysis showed the state electorate of Mandurah had the highest need for social and affordable housing, requiring about 188 additional homes annually.
The metro electorates of Armadale, Butler and Mirrabooka each needed at least 150 additional social and affordable homes every year, while the regional electorates of Bunbury, Dawesville and Kimberley required at least 100 each.
SGS Economics & Planning principal Ellen Witte said rental affordability in Perth had hugely declined over the past four years, hitting a record low RAI score of 98 in 2024. This brought the city into the “unaffordable” category for the first time.
“A household renting at the median rate now faces paying 31 per cent of its income on rent,” she said.
“Just four years ago, in mid-2020, rent represented 20 per cent of income.
“In regional WA, the average rental household paid 19 per cent of their income if renting a median rental in 2020. This has now risen to 26 per cent in 2024.”
The index found that the median Perth weekly rent of $629 took up 31 per cent of the median rental household income, exceeding the threshold for rental stress and overtaking Sydney, which is on 30 per cent.
In regional WA, median rents of $572 took up 26 per cent of median rental household income, and this figure would be even higher for many renters outside the highly paid mining industry.
Focus Property Wealth mortgage broker Glenn Biggins said there were 1915 rentals available, a slight increase from the 1719 properties available 12 months ago, indicating a trend to return to a more balanced rental market.
This is also reflected in the median rental asking price remaining at $650 per week.
“Real estate agents have reported inquiries from eastern states buyers seeking investment properties have diminished, suggesting a shift in demand dynamics previously due to Perth’s affordability over other capital cities,” he said.
“This suggests a potential market slowdown is under way, although the overall strength remains undeniable.”