Rent.com.au rental market snapshot: May 2023

Find out the latest on Australian rental prices, affordability, and market time with Rent.com.au’s May 2023 report. Get the scoop on leasing trends in metro and regional areas.

IN SUMMARY  

  • The median rent for both apartments and houses in Sydney, NSW stayed the same in May, with prices at $650 and $780 per week, respectively. The cost per room also remained stable at $350 per week.
  • In Melbourne, VIC, the median rent for apartments increased by 3% to $495 per week and for houses by 1.9% to $510 per week. The price per room also saw a notable increase of 3.7% to $215 per week.
  • In Darwin, NT, apartments experienced a significant decrease of 10.6% in median rent to $470 per week, while houses increased by 3% to $650 per week. The price per room increased by 4.7% to $210 per week.
  • In Canberra, ACT, the median rent for apartments increased by 1.8% to $540 per week, while the cost for houses remained unchanged at $650 per week. The price per room increased by 4.2% to $261 per week.
  • Nationally, the median rent for apartments increased by 2.2% to $570 per week, while the cost for houses remained unchanged at $580 per week. The price per room saw a small increase of 2% to $250 per week.

VACANCY RATE CHANGES

  • NSW: Availability UP by 7.9%
  • VIC: Availability UP by 0.7%
  • QLD: Availability UP by 2.8%
  • WA: Availability UP by 5.1%
  • SA: Availability DOWN by 5.2%
  • TAS: Availability UP by 5.4%
  • NT: Availability UP by 0.1%
  • ACT: Availability UP by 5.4%

Table 1: Median rent (apartments v houses) and price per room

Metro areaAPARTMENTSMonthly changeHOUSESMonthly changePRICE PER ROOMMonthly change
Source: 2023 Rent.com.au property listing data
Sydney, NSW$6500.0%$7800.0%$3500.0%
Melbourne, VIC$4953.0%$5101.9%$2153.7%
Brisbane, QLD$5200.0%$6000.0%$2162.7%
Perth, WA$5000.0%$5700.0%$195-2.5%
Adelaide, SA$440-1.5%$525-1.9%$183-2.1%
Hobart, TAS$425-1.6%$5300.9%$205-3.9%
Darwin, NT$470-10.6%$6503.0%$2104.7%
Canberra, ACT$5401.8%$6500.0%$2614.2%
National median$5702.2%$5800.0%$2502.0%

PRICE TRENDS

What’s being talked about?

Australia’s housing market remains a widely-discussed issue, as many renters struggle to find affordable and adequate housing, sometimes leading to homelessness. Despite a number of reforms and initiatives attempting to address these issues, the rental market still lacks supply to meet high demand.

The ANZ CoreLogic Housing Affordability Report released in May raised concerns about the state of housing in the country. The report emphasised an urgent need for more social housing as there is a shortfall of over half a million social homes. Low-income households are spending over half of their income on rent, and middle-income households are facing “rental stress” by paying more than 30% of their income in rent.

Rental demand is rising due to smaller households and migration, says the RBA, creating 120,000 new households during the pandemic. However, increasing rents may lead to a shift towards shared housing. Immigrants are also expected to contribute to demand, but investment conditions have not been favourable.

According to Rent.com.au’s May Survey, 55% of Australian renters felt that their concerns were not adequately addressed in the 2023-24 Federal budget, which left them feeling neglected by the announced measures. Meanwhile, 25% acknowledged that the measures presented were a step towards addressing the rental crisis, but did not provide a complete solution.

The WA Government also revealed its plans to reform the Residential Tenancies Act in May. The reforms aim to enhance the protection of renters while providing landlords with clearer guidelines. The proposed changes will give tenants more say over minor property alterations, such as painting walls and allowing pets, unless there are valid reasons against it. Furthermore, rent hikes will be limited to once a year, providing tenants greater stability.

The rental market in Sydney was steady in May, with apartments renting for $650 and houses for $780 per week. Meanwhile, Melbourne saw slight increases with apartments renting at $495 and houses at $510 per week. In contrast, Darwin experienced a significant decrease in apartment rents, down 10.6% to $470 per week, but had a 3% increase in house rents, now $650 per week. Across the country, apartment rents increased to $570 per week, while house rents remained unchanged at $580 per week.

WHAT WILL A ROOM IN A RENTAL COST ME? ?

Australia’s rental market saw significant changes in May 2023, with the cost of rooms in both apartments and houses in major metro areas skyrocketing compared to last year. Sydney still reigned supreme with a whopping 22.3% increase in median apartment room prices at $398 per week, while Melbourne took the cake for the highest increase in apartment prices at a staggering 27.5%.

Apartment room prices in Brisbane and Perth climbed 14.5% and 18.2%, respectively, while Adelaide and Hobart saw 15% and 13.1% increases. Darwin’s house prices fell 2.7%, but Canberra’s rose 1.5%. Nationally, apartment room prices rose by 20.7% to $350 per week, with houses up 7.1% to $187 per week. Renters seeking affordability should brace for a competitive market.

Metro areaAPARTMENTS% change (annual)HOUSES% change (annual)
Sydney, NSW$39822.3%$2508.70%
Melbourne, VIC$32527.5%$1636.50%
Brisbane, QLD$30014.5%$1878.20%
Perth, WA$30818.2%$1739.50%
Adelaide, SA$23015.0%$1737.20%
Hobart, TAS$28013.1%$2108.60%
Darwin, NT$25011.9%$182-2.70%
Canberra, ACT$38517.6%$2201.50%
National median$35020.7%$1877.10%
Source: 2023 Rent.com.au property listing data

HOW ARE THE REGIONS FARING? ?

The regional rental market in Australia experienced significant changes in May 2023. Western Australia emerged as the state with the highest annual increase in regional rents, recording a substantial growth of 22.2% to reach $550 per week. Following closely, South Australia saw a notable increase of 15.1%, bringing regional rents to $380 per week. Nationally, the median regional rent reached $500 per week, representing an 8.7% increase. These figures indicate a trend of rising rental prices in these regions.

In a recent study of regional versus capital city rents, the Australian Bureau of Statistics (ABS) said rents in regional areas farthest from capital cities have increased the most due to net population inflows and low vacancy rates. These factors have resulted in a divergence in rent inflation across capital cities and regional areas.

Table 3: % change to regional rents in May 2023

State/TerritoryMay-23% change from May '22
Source: 2023 Rent.com.au property listing data
New South Wales$5206.10%
Victoria$4206.30%
Queensland$54513.50%
Western Australia$55022.20%
South Australia$38015.10%
Tasmania$417-0.60%
Northern Territory$5301.90%
Aus. Capital TerritoryN/AN/A
National median$5008.70%

HOW LONG ARE RENTALS TAKING TO LEASE? ⌛

Australia’s rental market in major metro areas showed varying trends in May 2023. Melbourne had a 25% improvement in apartment leasing time annually, while Brisbane saw faster leasing times for both apartments and houses on a monthly basis. However, annual data for houses in Brisbane showed a decline of 19.2% slower leasing time. In Hobart, apartments experienced a monthly improvement of 6%, but houses had a substantial 80% slower leasing time annually. These highlights showcase the diverse dynamics of the rental market across Australia.

However, it also suggests that some markets remain highly competitive, presenting opportunities for landlords to achieve higher rental prices. The time on market (TOM) or time to lease (TTL) data can provide valuable insights into market trends and property performance, enabling property owners and managers to make informed decisions about rental prices and property improvements.

Table 4: Monthly and annual change to time on market in May 2023

Metro areaAPARTMENTSMonthly changeAnnual changeHOUSESMonthly changeAnnual change
Source: 2023 Rent.com.au property listing data
Sydney, NSW17 days4% slower16.3% faster20 days5% faster1% slower
Melbourne, VIC18 days6% slower25% faster20 days5% faster5.3% faster
Brisbane, QLD13 days5% faster1.6% slower18 days8% faster19.2% slower
Perth, WA15 days1% faster17.9% faster15 days2% faster4.4% faster
Adelaide, SA15 days1% faster4.2% slower17 days5% faster14.7% slower
Hobart, TAS20 days6% faster42.4% slower25 days17% slower80% slower
Darwin, NT19 days8% slower4% slower26 days24% slower46.8% slower
Canberra, ACT24 days13% slower39.5% slower27 days6% faster68.8% slower
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