Australia’s Rental Riddle: Unpacking the Post-Pandemic Landscape

Australia’s Rental Riddle: Unpacking the Post-Pandemic Landscape

  20 Jan 2024

Since the pandemic’s onset, finding a rental in Australia has become as challenging as snagging a seat at the AFL Grand Final.

Rental availability has plunged by half, and rents in our capital cities have rocketed by a staggering 33% in just two years.

Though the national vacancy rate nudged up slightly to 1.12% in December from October’s record low according to the latest Proptrack figures, it’s still a far cry from the 2-3% we’d call a balanced market where supply meets demand.

This scarcity is a headache for tenants who are now grappling with a highly competitive market.

We’ve written a lot about the factors that led to these extremely tough conditions including the trend towards living in smaller households, a rebound in population growth, a shortfall in new housing construction, and a slowdown in dwelling completions, not to mention investors cashing in and selling up their properties.

As expected rents have climbed a steep hill.

The national median advertised weekly rents have ballooned 38.1% post-pandemic, with regional WA taking the lead, followed closely by Perth and regional QLD.

As 2023 wound down, renters saw a hint of relief with a slight uptick in vacancies, yet the year was marked by persistent tightness that saw rents in our major cities—Sydney, Melbourne, and Perth—soar.

Melbourne led the charge in 2023, with vacancies shrinking more than anywhere else, with Sydney and regional Queensland not far behind. Meanwhile, Brisbane, Adelaide, and Perth are all sitting below the 1% vacancy rate, with Adelaide and Perth in particular at critically low levels of rental stock, though even there, we’ve seen a marginal ease.

Looking Ahead to 2024

Renters can draw a cautious breath of optimism for 2024, with signs pointing to a slowdown in rental price hikes.

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