Australia’s cheapest rental suburbs revealed amid RBA rate hike shock

The number of affordable rentals across the nation has fallen by almost 60 per cent, new research reveals. See where the cheapest rental suburbs in your state.

Australia’s cheapest rental suburbs have been revealed, as new research reveals the number of affordable rentals across the nation has fallen by almost 60 per cent.

But to make the most of those cheaper deals, renters will have to go bush.

Newborough in Victoria is currently Australia’s cheapest rental market, with a median unit price of $180 a week.

It was followed by Andamooka and Peterborough (SA, $200 for a house), Moe (VIC, $200 for a unit), Deniliquin (NSW, $250 for a unit). Whyalla (SA, $220 for a unit), Beresford (WA, $220 for a unit), Murray Bridge (SA, $225 for a unit), Charleville (QLD, $235 for a house) and Stanthorpe (QLD, $235 for a unit).

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There are now just 353 suburbs across Australia where the median house rent sits below $400, and 509 unit suburbs — but finding a vacant listing has become a much tougher ask.

The PropTrack Market Insight Report shows that the number of affordable rental listings (units and houses) – below $400 a week – has shrunk nationally from 42.5 per cent in March 2020 to just 17.6 per cent now.

For houses, it has dwindled to just 13.6 per cent.

But it is even worse at capital city levels, with Sydney’s share of dwellings below $400 shrinking from 21.3 per cent to 7.8 per cent and Melbourne down 18.8% to 20%.

In Brisbane, traditionally one of the more affordable capitals, the share has slid from 46.2 per cent to just 13 per cent on the back of record-high migration outstripping supply.

Loved to death Brisbane is feeling the rent squeeze

Adelaide, another city feeling the highs and lows of high interstate migration, has also seen its supply of affordable properties decline from 60.2 per cent to 18.3 per cent.

Every capital city and region has seen affordable rental supply tank – Darwin (from 43.9 per cent to 8.8 per cent), Hobart (from 32.7 per cent to 12 per cent) and ACT (from 9.8 per cent to 1.9 per cent).

The share of affordable rentals in Australia’s combined regions fell from 42.5 per cent in March 2020 to 17.6 per cent in February.

It comes as almost half of Aussie renters (43 per cent) said they struggled to pay their rent in February, according to Finder’s Consumer Sentiment Tracker.

Finding an affordable rental has never been harder, with record migration tipped to make the situation even worse.

Vacancy rates sit at just 0.8 per cent in Brisbane, 1.2 per cent in Melbourne, 1.3 per cent in Sydney, 1.3 per cent in Darwin, 0.5 per cent in Adelaide, and 0.7 per cent in Hobart.

PropTrack senior analyst Karen Dellows said capital cities had the fewest listings on offer, with the least affordable market being the nation’s capital, Canberra — where less than 2 per cent of available rentals costing less than $400 a week.

“Renters looking for a house in Melbourne will get more for their money if they look further out west,” she said.

“For renters in other capital cities, the regions of Adelaide – North (Adelaide), Ipswich (Brisbane), and Mandurah (Perth) are where you will find more affordable houses than in other parts of the city.”

Share of all rental listings under 400 per week as of February 2023. Source Realestate.com.au

Ms Dellows said that units under $400 were easier to find, but there were fewer on the market now than a year ago.

“The area with the largest proportion of reasonably priced units is Logan – Beaudesert, south of Brisbane, where there were 56 per cent of unit listings of $400 or below last month,” she said.

“The further away from the centre of the capital cities, the cheaper the properties get.

“Sydneysiders would need to go out as far as Sydney – Outer South West, around Bankstown and Campbelltown, to find more affordable units.”

But Ms Dellows said tenants across much of the country will continue to face difficulty finding homes they can afford, with very little supply and high demand pushing prices higher.

She said there were affordable options if renters were prepared to look further afield or even consider living in a share house.

But the housing headache is unlikely to get better anytime soon, with international students and overseas migration tipped to compound the pressures across all markets.

Right across the country, more and more renters are joining lengthy queues at open homes, or living on couches or in cars.

Source: Finder

Research by Homelessness Australia revealed that while wages had increased by 5 per cent nationally, rents had soared by 28 per cent.

“With an extremely tight vacancy rate, the market for rentals is simply galloping away, especially for people on low and middle incomes,” Kate Colvin, CEO of Homelessness Australia, said.

“Parents are trying to supervise their kids’ homework while living in tents.

“In a wealthy, developed nation, this is simply unfathomable.”

Shikera Maher and her family were living in their car in 2022. Picture: Brad Fleet

Finder’s head of consumer research Graham Cooke said the number of new housing loans for owner-occupiers and investors had also fallen 30 per cent and 27 per cent respectively, in December 2022 versus December 2021, according to ABS data.

Mr Cooke said mortgage costs had gone up faster than rental costs.

“This could mean there is a lag yet to hit the already heated rental market,” he said.

The RBA today hiked the official cash rate by another 0.25 percentage points, hitting a decade high of 3.6 per cent.

Many economist are tipping that it will peak at 4.1 per cent, with the banks expected to pass those rate hikes on in full and investors forced to push those increased costs onto stretched renters.

Brisbane families have been living in holiday parks due to the massive competition in the rental sector. Picture: Matthew Poon.

Originally published as Australia’s cheapest rental suburbs revealed amid RBA rate hike shock