Renters in Australian capital cities have suffered the highest increase for a 12-month period since records began in 2007 as the nation’s housing crisis shows no sign of slowing down.
The combined capitals’ rental rate increased 11.7% over the past year, far above the average increase of 3.5%.
The record increase is equivalent to about $63 a week, or $3,200 a year in rent.
In the past three months alone rent in capital cities increased by 2.8%, and with vacancy rates remaining well below the average rate of 3%-5%, rental rates are expected to continue increasing.
According to Corelogic’s latest Rental Pulse report, the “mismatch” between supply and demand continues to force rent higher, with the total supply of capital city rental listings in April coming in at 20.9% below the level recorded at the same time last year.
Sydney remains the country’s most expensive capital to rent in, with the average tenant paying $711 a week, up 1.3% in the past month and up 13.1% for the year.
Melbourne, where the average rent is $535 a week, has lost its position as the country’s most affordable capital to Adelaide, where the average rent is $534 a week.
Sydney and Melbourne continue to record the strongest growth in unit rents across the capitals, with both cities seeing new peak rates of growth. Sydney’s unit rents increased 19.1% over the past year, while Melbourne’s increased 15.2%.
The report said it was “unlikely” that there will be much in the way of relief for tenants in the short to medium term, as demand continues to outstrip supply.
The report also said a rise in migration and the return of international students has led to increased demand for rental listings.
“Given that the flow of new unit approvals has held below average since 2018, the rental market will likely continue to have supply issues over the medium to long term,” the report said.
The Corelogic economist Kaytlin Ezy said it was the biggest increase the company had seen, with their records going back to 2007.
“These are the strongest increases we have on record, and a rental increase of $3,200 is quite monumental for anyone. I don’t think anyone’s looking at this number and thinking this is normal.”
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Ezy said relief was not on the horizon for renters, with medium to high density approvals remaining “well below” the 10-year average.
“With approvals holding so low, it’s likely we’ll see a shortage start to accumulate in those medium to high density rental properties moving forward.”
The Tenants’ Union of NSW CEO, Leo Patterson Ross, said it was “frustrating” to see the increases when “we know there are solutions available to governments across the federal, state and local levels”.
“It’s important to acknowledge that we’re in a crisis, for many people the tipping point has already well and truly passed.
“We need to see strategies for fair limits on rent increases during a tenancy and rent setting at the start of a tenancy. We also need to see jobseeker income raised to the poverty line to ensure households with low income are able to meet their needs.
“We want to see an increase in genuinely affordable housing supply to lower rent prices and bring relief to renters.”
