Affordable rentals dry up

Australia’s national rental crisis has continued to worsen, with new data depicting a shrinking pool of affordable properties on the market.

The latest PropTrack Market Insight Report revealed the number of rental properties listed for under $400 per week in April fell to its lowest level on record in all capital cities except Hobart and Darwin.

It comes just a month after total rental listings for all price points hit a record low in March, with demand continuing to surge.

PropTrack’s senior economist Eleanor Creagh said there had been a dramatic shift in rental supply over the past year.

In May last year, 30.2 per cent of all national rental listings were under $400 per week. That number has nearly halved to 16.2 per cent, she noted.

The change would hit lower income Australians hardest, Ms Creagh said.

“Although the increase to Commonwealth Rent Assistance is the largest in more than 30 years, rent assistance payments have long fallen behind soaring rental prices,” she said.

“The share of affordable rentals is plummeting, meaning conditions remain challenging for low-income Australians.

“Rising immigration figures have also contributed to strong demand outstripping the supply of available rentals.

“Treasury forecasts have indicated that Australia is on track for net migration of more than 300,000 people this year, and there’s simply not enough rental properties to meet this demand.”

Sydney, Melbourne, Brisbane, Perth, Hobart, Darwin, the ACT, and regional WA had all seen the share of total affordable rental listings halved in the past year.

For cities like Sydney, Darwin, Hobart and Perth, less than nine per cent of listings were under the $400 per week threshold.

The share of sub $400 a week units rentals declined from 35.6 per cent in April 2022 to 19.8 per cent last month.

Low vacancy rates and limited new supply mean tough conditions for renters are likely to remain, with the share of $400 per week rentals to stay low.

“Pressure has shifted from regional areas to the capital cities – particularly in inner-city areas – as demand from overseas migration has increased,” Ms Creagh said.

“While there was some slight increase in the rental supply and the number of rental vacancies recorded in April, it’s not enough to make an impact in the short term for Australia’s renters.”

It follows recent reports from tenants of poor quality rentals in some areas, with some renters waiting months to have complaints about mould infestations addressed.

PropTrack also noted that without an imminent increase in supply, the number of rentals available would remain low and drive up competition for properties even further.

PropTrack’s director of economic research Cameron Kusher said this could lead to people becoming homeless, particularly those without jobs on government support payments and essential workers.

“I know rent bidding is not allowed but the reality is if you’re in a position to offer more than the advertised rent you have a better chance at securing a property,” he said.