PropTrack: Aussie rents rise 5 per cent, $31 a week, in lifeline for landlords, crippling blow to tenants

Aussie landlords have been handed a financial lifeline that could help them keep a hold of their rental properties as they grapple with home finance pressures. But it’s dire news for tenants.

Australia’s rental market is under strain, with prices surging and affordable housing in short supply.

Rents have soared to a record high across Australia and struggling tenants are being forced to downsize, move to share houses or out to city fringes and regional areas.

And industry experts warn there is worse to come, with tenant advocates and property leaders calling for urgent national reform amid fears the system is no longer working for average-income earners.

Latest PropTrack rental data shows the national median advertised rent hit $650 a week in March, following a 1.6 per cent increase in the first three months of 2024.

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The figure is 5 per cent higher than the same time last year — the equivalent of $1612 extra a year.

Unit rents are now rising faster than houses for the first time in months, putting pressure on tenants relying on the nation’s most affordable homes.

In some cities, the rental rebound has come after a period of relative stability.

In Melbourne, rents jumped 2.7 per cent over the March quarter after sitting flat for six months.

PropTrack’s rental report for March showed mixed results for tenants and landlords around the country.

Brisbane and Perth also posted strong gains, while regional areas saw advertised rents rise 5.8 per cent year-on-year to $550 a week — putting pressure on tenants in outer suburbs and country towns

PropTrack senior economist Anne Flaherty said the trend was being fuelled by a mismatch between housing supply and population growth.

“We are absolutely at the beginning of a new growth cycle,” Ms Flaherty said.

“How quickly affordability deteriorates will depend on how fast the population continues to grow, and how quickly we can build new housing to keep up with that demand.”

REA Group’s Anne Flaherty said rents are rising as population growth outpaces new housing supply.

Ray White AKG principal Avi Khan said many tenants were still offering months of rent in advance in hopes of securing a property.

“People are desperate,” Mr Khan said.

“We haven’t seen a slowdown this year — not even during the usual election-season pause.”

The agent said rising costs were pushing many landlords to increase rents just to break even, making a national rent rise good news for those who were barely managing to hang on.

Ray White AKG principal Avi Khan said renters are desperate with some offering months of rent upfront to secure homes.

“It’s not just about profit, it’s about covering basic expenses,” he said.

“Maintenance costs are up, insurance has gone through the roof, and without support or supply, the cost burden gets passed on.”

Mr Khan said the investor landscape had also changed, with many buyers no longer sticking to their home state.

“We’re seeing more buyers from Victoria and New South Wales coming into Queensland,” he added.

“They see it as easier to get into, and the state borders are starting to blur.”

National Shelter chief executive and housing advocate Karen Walsh said the country’s rental crisis had become the worst she had seen in decades.

“We’ve well and truly passed the tipping point for affordability,” Ms Walsh said.

“People are now paying 50 to 60 per cent of their income on rent.

“We’re seeing full-time workers living in cars, tents, or skipping medication just to keep a roof over their heads.”

A rental crisis that led to lengthy queues in recent years is now headed into a new phase.

Ms Walsh said the issue had moved beyond housing.

“This is a health and dignity crisis,” she said.

“Families are relying on food banks (and) older women are the fastest-growing cohort at risk of homelessness.

“The gap between incomes and rent just keeps widening.”

The National Shelter chief executive said there were early signs of progress in more rental homes, including institutional investment in build-to-rent projects and new government funds.

But she warned the scale of the problem required far more ambitious intervention.

“We’re already short 640,000 affordable homes and that’s forecast to reach over a million by 2041,” Ms Walsh said.

“If I could introduce one policy tomorrow, it would be a massive, sustained national build of social and affordable housing.”

National Shelter chief executive and housing advocate Karen Walsh Housing said working renters are skipping meals or sleeping in cars to stay afloat.

She also called for the creation of a National Rental Commissioner to ensure consistent protections for tenants across the country.

“Right now, your rights as a renter depend on your postcode,” she said.

“We need a national framework, and we need it urgently.”

“It’s peaceful, it’s different — and it’s always been a bit of a dream of mine to own something like this,” Mr Gill said.

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Originally published as PropTrack: Aussie rents rise 5 per cent, $31 a week, in lifeline for landlords, crippling blow to tenants