Record High Rents Across Australian Capitals

In March, rents for houses in combined capitals reached a new peak at $650 per week, marking a $20 increase from the previous year. Similarly, unit rents rose by $30, hitting $620 per week. Darwin and Perth saw significant hikes, with house rents in Darwin jumping 7.7% to AUD700, and Perth experiencing a 6.2% increase to AUD690.

Residential properties line the Sydney suburb of Birchgrove in Australia, August 16, 2017. Photo by Reuters

Vacancy Rates and Market Balance

The national vacancy rate remains critically low at 0.8%, far from the 3% needed for a balanced market. Despite a slight improvement from last year's 0.7%, the situation underscores a landlord's market dominance.

Supply, Demand, and Affordability Crisis

Nicola Powell of Domain notes that while increased supply has moderated price growth, it's insufficient to meet demand. The rental crisis is severe, with only 0.6% of rentals affordable for minimum wage workers. Sydney and Melbourne have seen rents soar by approximately 20% over four years, exacerbating the affordability crisis.

The Economic Divide

Matthew Bowes from the Grattan Institute highlights a two-speed economy, where homeowners benefit from wealth appreciation, while renters face increasing financial strain. Even middle-to-high income earners are not spared, with a single individual needing AUD130,000 annually to afford a typical unit comfortably.