Australia's median rent surges to record heights with regions and outer suburbs feeling the heat

Rents have reached a record high with the national average now at $627, pushing renters further to the outskirts of capital cities.

Annual rent growth began accelerating in 2024, with rents now 8.5 per cent higher than this time last year, according to the latest data from CoreLogic.

“Not only are rents rising quickly, but they’re rising at a bit of a faster pace than what we saw towards the end of last year,” CoreLogic’s head of research Eliza Owen said.

The growth is most pronounced in regional Australia and the outer suburban areas of cities, Ms Owen said.

“That suggests that people are having to move further out to secure a rental,” she said.

Here’s how the rental market is looking in state capitals, from highest percentage increase to the lowest, as well as a look at the regions.

Perth

• Median rent $669
• Year-on-year increase 13.6 per cent

The rental market in Perth saw the highest annual rent increase of all capital cities in the last year, as well as the highest uplifting of rent values since the onset of the pandemic at nearly 60 per cent.

The median weekly rent in Perth is now $669, after increasing 13.6 per cent year-on-year.

“For locals who have been in certain areas for longer periods of time, and are rolling on to leases 12 months at a time, it can be very disruptive,” CoreLogic’s head of research Eliza Owen said.

Western Australia more broadly is seeing a turnaround in the migration trends of the past few years, Ms Owen said.

“Net interstate migration has turned positive and net overseas migration is obviously very strong across the country, so that’s really skewing to higher levels of rental demand,” Ms Owen said.

Employment, particularly an upswing in mining, play a role as well, she said.

The suburbs with the highest growth were Serpentine-Jarrahdale (19 per cent), Belmont-Victoria Park (17.8 per cent) and Armadale and Mundaring (both 17.2 per cent).

Melbourne

• Median rent $589
• Year-on-year increase 9.6 per cent

Melbourne saw the second highest annual increase of all the state capitals, with rents rising at 9.6 per cent.

The rental growth was the highest in the suburbs of Dandenong (16.2 per cent) Tullamarine-Broadmeadows (14.1 per cent) and Whittlesea-Wallan (14 per cent).

Adelaide

• Median rent $580
• Year-on-year increase 9.1 per cent

Adelaide’s median rent of $580 is now just below that of Melbourne at $589.

The South Australian capital overtook Melbourne weekly rents in May 2022, and the two cities have been neck and neck since.

The highest growth was seen in the suburbs of Salisbury (12.8 per cent), Playford (11.4 per cent) and Port Adelaide — East (11.3 per cent).

Sydney

• Median rent $770
• Year-on-year increase 9.0 per cent

While Sydney overall saw a 9 per cent increase in median rents, some pockets of the city were below peaks from 2023, such as Canterbury, Pennant Hills, Epping and Parramatta.

The suburbs that saw the highest growth were Fairfield (14.8 per cent), Blacktown (14.2 per cent) and Campbelltown (13.4 per cent).

Brisbane

• Median rent $649
• Year-on-year increase 8.5 per cent

The suburbs with the highest growth were Wynnum-Manly (12.6 per cent), Capalaba (12.2 per cent) and Sunnybank (11 per cent).

Darwin

• Median rent $617
• Year-on-year increase 3.5 per cent

The highest increase seen in Greater Darwin was in Litchfield (5.5 per cent), Palmerston (4.7 per cent) and Darwin suburbs (4.1 per cent).

Canberra

• Median rent $674
• Year-on-year increase 1.8 per cent

Canberra rental prices have been rising for the past seven months.

After house rents fell by 3.4 per cent in the year to September, the recent growth takes the year-on-year change to an increase of 1.8 per cent.

The highest increases were recorded in Weston Creek (3.4 per cent), Tuggeranong (2.8 per cent) and North Canberra (1.8 per cent).

Hobart

• Median rent $547
• Year-on-year decrease 0.2 per cent

Hobart was the only capital city to see an overall decrease in rental prices, with the cost of rentals going down 0.2 per cent annually.

The highest price growth was seen in Sorell-Dodges Ferry (3.2 per cent), Brighton (1.5 per cent) and Hobart North-East (0.5 per cent).

Regions and outer suburbs feel the surge

In regional Australia, annual rental growth went from 3.5 per cent in the year to October 2023, to about 6.5 per cent in the year to April.

The rental price growth is particularly prevalent in the regions and outer suburbs located within 30-40 kilometres of city centres, such as Campbelltown in Sydney, Casey North in Melbourne and Jimboomba in Brisbane, Ms Owen said.

“What you might notice about some of these areas is that while they’re not inherently cheap, they are some of the relatively affordable pockets of our cities as well,” she said.

The trend reflects the cost of living crisis, which is putting more pressure on areas that used to be cheaper by comparison, Ms Owen said.

“It’s basically this rippling of stronger growth rates out to those more peripheral or affordable areas.”

That ripple effect leaves lower wage earners more vulnerable to housing insecurity, Ms Owen said.

“For them, there is no next affordable rental market and that’s where I think the rental crisis is most urgent among lower income households.”

Why are rents rising again?

Many short-term factors have led to the current surge in rental prices, Ms Owen said.

Those include fewer people living in each household through the pandemic and a temporary spike in overseas migration that skewed rental demand, but that’s not all.

“This is also coming from decades of successive policy failure. Underinvestment in social and affordable housing, declining rates of home ownership which have put more pressure on the private rental market,” Ms Owen said.

“Because those are not overnight causes, there’s no real overnight solution to what we’re seeing in the rental market.”

A normalisation in overseas migration will take some of the pressure off, but Australia should also look to increase the capacity of the construction sector, Ms Owen said.

“There’s a very high volume of dwellings that are approved or under construction, but they’re not complete, they’re not ready to live in, so focus on working down that pipeline is really important at the moment as well.”

ABC