In an interesting twist on rental affordability, recent PropTrack data reveals that renting a house in Melbourne or Hobart is now less expensive than in Adelaide.
Adelaide's house rents have surged by $60 weekly over the past year, now sitting at a median of $560 per week.
This represents a 1.8% increase over the last quarter and a significant 12% rise year-on-year.
By contrast, Melbourne and Hobart's median rents for houses remain at $550 per week.
Melbourne experienced a 14.6% increase from the previous year, while Hobart's rental prices have remained stable according to Proptrack.
Why this disparity?
Melbourne's greater preference for apartment living has kept house rents in check, reflecting the city's urban lifestyle.
Hobart's housing market is cushioned by a higher proportion of owner-occupiers, owing to its older demographic, which reduces rental demand.
Adelaide's unit rents, however, have seen a 2.2% quarter increase and a 9.5% annual jump, now equalling Hobart's at $460 per week—making them the most affordable in the country alongside Hobart, and notably $60 less per week than in Melbourne.
For Adelaide tenants, the pinch may continue for some time.
The rental crisis around Australia is not going away any time soon - we're just not building enough accommodation for the strong demand for housing.
In fact, in most capital the rental sector is expected to remain robust, outpacing the sales market in 2024, which may see an increase in supply coming onto the market soon.
Of course, with the difficulty finding rental accommodation and the higher cost of renting could encourage more renters to transition to homeownership.
- Also read:Perth housing market update [video] | September 2024
- Also read:Sydney housing market update [video] | September 2024
- Also read:Latest property price forecasts for 2024 revealed. What’s ahead in our housing markets in the next year or two?
- Also read:Melbourne housing market update [video] | September 2024
- Also read:Australian housing market update [CoreLogic’s video] | September 2024
At a national level, Proptrack reports that house rents have climbed by 3.4% for the quarter and 9.1% annually to $600 per week, with unit rents following suit at a 1.8% quarterly and 13.1% annual increase to $560 per week.
According to PropTrack's senior economist, Angus Moore, the rental market continues to be a challenge for tenants nationwide.
He said there were some signs rental growth was slowing though.
“While rents are still growing very quickly, rent growth in 2023 was slower across the combined capital cities compared to 2022,” he said.
“As we head into what is typically the busiest time of year for rental markets in January, renters will, unfortunately, continue to face growing rents.
There may be some relief on the horizon, with signs that growth is starting to ease.”
