Worst is over: where rents are plummeting

The worst of the rental crisis appears over across much of Australia, with rents plummeting in these areas. But it’s not all good news.

Tim McIntyre

3 min read

October 29, 2024 - 5:00AM

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The worst of the rental crisis appears over in some Australian capitals, with asking rents falling or static across more than half of the suburbs in one major location, while slowing considerably in others.

But other metropolitan areas are telling a different story as economic conditions collide to put more pressure on tenants.

Exclusive new data from PropTrack revealed asking rents were on the way down for 60 per cent of Sydney suburbs, while rent in one in five suburbs were falling in Adelaide.

In Melbourne however, suburbs where rents have surged the most since the pandemic have been tipped as some of the next areas the state government could target for high-density development, while Queensland has seen 15 per cent growth in asking rents for the quarter after a momentary lapse across the previous three months.

Even modest homes have proved expensive to rent in some suburbs.

Demand remains the driver for asking rents in all areas, with some cities experiencing more supply than others, due to differing levels of construction, migration, investor activity and general affordability

RENTING IN NSW

Sydney has entered a correction phase, with consecutive soft quarters.

PropTrack economist Eleanor Creagh has attributed the market slowdown to more rental homes becoming available and tenant demand dropping as more renters moved to share houses or back in with their parents to save money. Migration has also waned in recent months.

“Demand and supply are working together to see a stabilisation in rental market conditions. That’s good news for renters,” Ms Creagh said.

The biggest rental price drops in metro Sydney over the quarter were in North Willoughby and North Balgowlah, where houses were renting for $200 less per week.

MORE:The biggest Sydney rent falls by suburb

Sarah Danskin with her roommate Annika Debono. Sarah purchased a property this year and is rentvesting. Picture Thomas Lisson

Both Sarah Danskin, 27, and her housemate have turned to rentvesting as neither could afford properties in Sydney. Ms Danskin rents in Mortdale and owns a home in Townsville, bought for $550,000.

Finding their Mortdale home was challenging but not as gruelling as they expected, Ms Daskin said. One of their biggest issues was finding something in good condition.

“I think of the standard of the apartments compared to the price we wanted … I went to an inspection where they wanted $580 a week and the toilet was broken, the roof was caving in.”

RENTING IN SOUTH AUSTRALIA

In Adelaide, median weekly asking rents have fallen in almost 20 per cent of all suburbs over the past quarter, giving hope to many struggling tenants in the midst of a cost of living crisis.

The PropTrack data shows weekly rents have dropped in 42 of 249 suburbs, while remaining unchanged in a further 65 suburbs.

Dollars-wise, the biggest price drop can be seen in Findon, where the median unit price is $65 lower than in June.

In terms of dollar difference over the past quarter, Glenside houses have experienced the biggest jump in median weekly rent, up $78 from $720 to $798.

MORE:The biggest Adelaide rent movements by suburb

In Adelaide, median weekly asking rents have fallen in almost 20 per cent of all suburbs over the past quarter.

RENTING IN VICTORIA

Melbourne suburbs where rents have surged the most since the pandemic have been tipped as some of the next areas the state government could target for high-density development.

Well-connected areas like Ashburton, Parkville, Aspendale, Caulfield South, Glen Waverley and Carlton have posted some of the biggest rises in weekly unit rents across the past three years, all of them up more than 40 per cent, according to new PropTrack data.

They’re among the more than 200 suburbs where rents are now at least $100 a week more expensive for units than in 2021, with high-density development hubs including West Melbourne and Southbank dominating the top of the growth areas.

MORE:The biggest three-year movements for Melbourne suburbs

PropTrack economist Eleanor Creagh. Source: Supplied

RENTING IN QLD

Queensland’s asking rents have surged again, increasing across 252 Queensland suburbs by

up to 15 per cent since June.

Ms Creagh said even a small increase in rents now, after several years of strong rent price growth, was putting significant pressure on renters.

“Rents have increased significantly in recent years, up 60 per cent for houses in regional Queensland since the start of the pandemic (March 2020) and 67 per cent for units,” she said.

“In Brisbane, it is up 53 per cent for both houses and units.