Domain’s March quarter 2024 Rent Report found the median asking rent for houses in the country’s combined capitals is now $630 per week, up 5% over the three months ending December 2023.

The latest price increase in house rents is the steepest quarterly gain in 17 years and the second highest on record, according to Domain. 

Meanwhile, combined capital unit rents continued their record-breaking 11 consecutive quarters of growth, with the latest at 3.3%, to bring the median weekly rent prices for apartments to a new all-time high of $620. 

Domain’s chief of research and economics Dr Nicola Powell chalked the latest price increases up to the effects of seasonal changes and insufficient housing. 

“The first quarter of the year usually marks the rental change-over period, and we anticipated it would be one of the most challenging seasons yet due to the already low rental stocks,” she said.

January and February are typically the busiest months for rentals as students return to school – and consequently to their rental accommodations – and many Aussies kick off the year making big moves.

“The current rental conditions show this intensified seasonal trend – a surge in tenant demand against a limited supply. This imbalance has consequently fuelled a renewed acceleration in rental price growth,” Dr Powell noted.

“It was always anticipated that the changeover period would be challenging for tenants as it was the most competitive Australia had ever seen.”

Rents reach peak but growth is decelerating

Renting in houses across the major cities is costing renters 10.5% more than 12 months ago; unit tenants, on the other hand, are paying 12.7% higher rent per week. 

Record asking rents span all cities except Canberra houses and Hobart units, which both witnessed price falls.

Rental prices in every capital also hit new record highs, save for Canberra, Darwin and Hobart houses, and Darwin and Hobart units.

“Largely, growth remained below peaks but has become mixed across the cities,” Dr Powell said.

The Domain chief of research noted the rents in Perth, Sydney and Adelaide houses, and Brisbane units appear to have reaccelerated more than a typical seasonal impact. 

“While it is hard to rule out that momentum is established, as it stands, quarterly growth is largely lower compared to peaks seen over 2021-23," she said.

Rental prices for houses

Here are the latest median weekly asking rents for houses in capital cities.

Rental prices for units 

Here’s how much unit landlords charge renters weekly, on the median, in Australian capitals.

Asking rents spike as available housing takes a nosedive

Adelaide recorded the highest quarterly price leap in house rents at 5.4%, while Perth has had the steepest annual increase at 18.2%. 

The record gains were consistent with record-low vacancy rates. 

As it stands, both Perth and Adelaide have the lowest available housing for tenants, with both cities’ vacancy rates at 0.3%.

Melbourne and Perth (up 5.8%) and Brisbane (up 5.4%) recorded the highest quarterly unit rent growth, with Perth taking the crown for the biggest annual price increase at 22.2%. 

The vacancy rates in Melbourne and Brisbane (along with Sydney) also hover along the critical levels at 0.7-0.8%. 

On the other hand, the higher – albeit still critical – vacancy rates in Canberra (1.4%) and Hobart (1.1%) translated to steady to lower price increases in median weekly rents.  

A turning point on the horizon

Despite a seemingly never-ending run of rent rises, Dr Powell is optimistic that “a tipping point will be reached” this year. 

“Currently we are seeing the number of prospective tenants per rental listing ease, suggesting some pressure has been lifted," she said.

“This could be an early indicator of an increase in vacancy rates sometime this year.”

To achieve a balanced market – a vacancy rate of 2-3% – Dr Powell said Australia needs between 40,000 and 70,000 rentals. 

Although the continued slowdown in building approvals might make this goal harder to achieve, the Domain research chief believes the easing in migration and the implementation of incentives for homeownership will contribute to the deceleration of rental growth. 

“International student visa applications have turned a corner and started to fall for the first time in more than two years, population growth is likely to have peaked, and the federal government has introduced a migration strategy that will slow population growth,” she said. 

“Homeownership is also at the forefront with incentives in place (such as Queensland doubling the first-home buyer grant and the federal government's ‘Help to Buy’ shared equity scheme), which will help transition some to being owners or fast-track others to a more affordable purchase.”

Read more: Home Loans News

Bernadette Lunas

Finance Journalist

Bernadette is a journalist with years of experience covering topics in macroeconomics, real estate, and lifestyle beats for notable print media organisations. She joined the InfoChoice Group in 2024, bringing her passion for writing stories that help Australians make better decisions about money.

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