After years of sharp increases, rental conditions across most Australian cities are finally showing signs of relaxation.
According to Megan Lieu (pictured above), an economic analyst at REA Group, the market is stabilising, which spells good news for renters.
This positive shift is attributed to the flatlining of rent prices in the majority of cities, with some regions even experiencing declines.
The latest PropTrack Market Insights Report indicated a modest national rent price increase of 1.6% from September to December.
However, during the same period, rent prices in all capital cities remained unchanged, except for Brisbane and Canberra, signalling a significant cooling off from previous rapid growth rates.
In Sydney and Melbourne, the two largest rental markets, weekly rents held steady at $730 and $570, respectively, for the last six months.
This stability follows annual rent increases reaching as high as 11.5% in 2023 and 15.6% in 2022.
In areas like Adelaide – West, Queensland – Outback, and Central West, rents have actually decreased, with reductions ranging from $10-$15 per week.
Other regions, including Sydney - Ryde, Darwin, and Sydney – Blacktown, have also seen weekly rent decreases of 2%-2.3%, or $5-$15, reflecting an easing rental market.
For those renting units, regions like Mandurah, Melbourne - Inner East, and South Australia - South East witnessed the most significant quarterly rent reductions, with drops of 3.8%, 3.4%, and 3.1% respectively. These adjustments represent a weekly decrease of $10-$20.
Other regions, such as Sydney - Parramatta, Adelaide - West, and Sydney - Outer West and Blue Mountains, also saw modest reductions, PropTrack reported.
The rental market’s moderation is largely due to an increase in rental property availability, likely driven by a resurgence of investors and a shift of first-home buyers from renting to owning.
Data from the Australian Bureau of Statistics (ABS) showed that investor lending surged by 25.2% from September 2023 to September 2024, while first-home buyer loans rose by 8%.
Looking ahead, rental price increases are expected to continue but at a much more moderate pace compared to previous years, providing potential long-term relief for renters.
Read the PropTrack report here.
