From September '20 to June '23, rents across Australia's eight capital cities had grown by nearly a third.
After a surge to regional areas during the pandemic, housing preferences have normalised, with demand returning to Australia's largest cities in a big way.
Combined with strong net overseas migration, which is typically concentrated towards Sydney, Melbourne and the other major cities, it's a difficult time to be looking for a rental property.
CoreLogic's most recent rental review found vacancy rates in the capital cities were at 1% in September, a new record low.
Despite this though, rental growth has tempered recently, slowing in Perth, Melbourne, Sydney and Adelaide in the September quarter.
CoreLogic economist Eliza Owen says that with rents so high, as well as the slowdown in income growth caused by elevated interest rates, tenants are starting to avoid expensive areas.
"In the 12 months to June last year, ABS data showed more affordable rental markets like Logan/Beaudesert and Ipswich [both Queensland] with the first and third highest volume of net internal migration across the country," she said.
With tenants in mind who want to live in the city, but save on rent, CoreLogic has revealed the cheapest suburbs to rent within 20kms of capital city centres, as of September '23.
|Wiley Park||Inner South West||$491|
|Punchbowl||Inner South West||$498|
|Lakemba||Inner South West||$501|
Renters hunting for a bargain in Sydney will be drawn to Parramatta and the Inner South West.
For houses, the Parramatta suburbs are available at about a 15% discount from the median rate in Sydney, while tenants who rent a unit in Berala could expect to save more than 28% per week in rent.
|Kings Park||Melbourne West||$442|
|St Albans||Melbourne West||$398|
|Deer Park||Melbourne West||$406|
There are cheap rents available heading away from the Melbourne CBD, but Ms Ezzy said some tenants should assess their situation before heading west.
"Despite being within 20kms of the CBD, commute times from suburbs like Albanvale and Kings Park to the city are around an hour by public transport," she explained.
"This means they may not be ideal locations for students or young professionals working in the city."
Melbourne's West does though boast employment hubs nearby, around industrial and warehouse precincts.
|Strathpine||Moreton Bay South||$446|
|Brendale||Moreton Bay South||$459|
|Alexandra Hills||East Brisbane||$468|
Woodridge was not only the lowest median rent for both houses and units of Brisbane suburbs, but also has the cheapest units to rent of any suburb in Australia within 20kms of a capital city.
If you're looking for a cheap rental in Brisbane, Woodridge is around 20 minutes from the Brisbane CBD on public transport, and also has Logan City nearby.
Investors might also be interested to hear rental yields for units in Woodridge were 7.0% in September.
|Brahma Lodge||North Adelaide||$475|
|Salisbury Downs||North Adelaide||$478|
|Salisbury East||North Adelaide||$361|
|St Marys||South Adelaide||$403|
Bargain hunters in Adelaide should look north, where eight of the 10 cheapest suburbs are situated.
The Salisbury area in particular boosts rental properties available at heavily discounted rates from the state average, for both houses and units.
|Girrawheen||North West Perth||$491|
|Gosnells||South East Perth||$501|
|Midland||North East Perth||$503|
|Middle Swan||North East Perth||$518|
|Koondoola||North West Perth||$519|
|Midland||North East Perth||$433|
|Gosnells||South East Perth||$441|
|Noranda||North East Perth||$445|
|Hamilton Hill||South West Perth||$457|
|Coolbellup||South West Perth||$462|
Perth has seen the strongest rental growth of all Australia's major cities since the pandemic, rising 44.9% over the past three years.
Areas like Girrawheen, where houses are available for rent nearly 20% cheaper than the average for Perth, are likely to start to become more popular.
After the boom Hobart experienced in the 2010s, it has bucked the national trend with rents declining 1.7% over the year to September.
There are still pockets where cheaper rentals are available in Hobart, but the discount rate is less dramatic than other cities.
Canberra is similar to Hobart, also experiencing an annual decline in rental values, but the capital is still among the most expensive area in Australia to rent.
The suburb with the lowest rental prices for houses were an average of 12.7% below the city average, and about 11% lower for units.
Darwin was one of the cities that has seen the most dramatic growth to rental rates in recent years, up 35.7% since 2020.
Tenants paying the median rent in Darwin would have seen their weekly repayments increase by $162 during that time.
The cheapest houses in Darwin were concentrated in the satellite city of Palmerston, while some of the cheapest suburbs to rent units were closer to the city and coast line.
Photo by Andrew Mead on Unsplash