Key takeaways
In highly desirable Australian suburbs, finding rental properties has become increasingly difficult due to limited supply and fierce competition among tenants, leading to soaring rental prices.
The COVID-19 pandemic has significantly influenced rental market dynamics, with inner-city suburbs experiencing the most tightening due to factors such as smaller household sizes, urban revival, and a surge in migration and student arrivals.
Suburbs like Dee Why, Maroochydore, and Coogee are facing exceptionally tight rental markets, with vacancy rates as low as 0.32%, making it extremely challenging for renters to find suitable accommodation.
Despite the tight conditions in major cities, some regional areas and suburbs on the outskirts are seeing an easing of rental market pressures, offering renters more options and value. Suburbs like Taylor and Denman Prospect in Canberra are benefiting from recent housing developments, providing relief to renters.
While challenges persist, there are signs of the rental market rebalancing. Factors such as increasing household sizes and growing investor interest may contribute to easing conditions in the future, providing hope for renters facing the current crisis.
In some of Australia's most sought-after suburbs, finding a rental property is an increasingly herculean task.
With a tiny fraction of properties available for rent tenants face fierce competition, driving up rental prices and exacerbating the existing rental crisis.
High demand and limited supply are leaving many in a lurch.
However, it's not all doom and gloom.
Signs of easing conditions are emerging across the country, particularly in regional areas and suburbs skirting the capital cities.
According to the latest data from PropTrack, while hotspots like inner city and coastal suburbs remain tight, other areas are offering more breathing space for renters in this challenging market.
Impact of the pandemic on rental markets
The pandemic has undeniably played a significant role in shaping these market dynamics.
PropTrack's senior economist, Eleanor Creagh, observes that since 2021, rental markets in inner city suburbs—those hit hardest by the pandemic—have seen a significant tightening due to smaller household sizes, the revival of city life, and a surge in net migration and student arrivals.
Take Dee Why on Sydney's northern beaches, for instance.
With a vacancy rate of just 0.32%, it's currently the suburb with Australia’s tightest rental market.
- Also read:Adelaide housing market update | December 2024
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- Also read:Melbourne housing market update | December 2024
In contrast, suburbs like Maroochydore on Queensland’s Sunshine Coast and beachside locales like Coogee in Sydney and Rockingham in Perth also witness low vacancy rates, indicative of a highly competitive market.
The reasons for this tightening are multifaceted.
Surging population growth, a lack of new housing construction, and sales by investors have all conspired to reduce available rentals.
The suburbs where it's nearly impossible to find a rental
| Rank | Suburb | State | Region (SA4) | Vacancy rate |
| 1 | Dee Why | NSW | Sydney - Northern Beaches | 0.32% |
| 2 | Maroochydore | QLD | Sunshine Coast | 0.33% |
| 3 | Pimpama | QLD | Gold Coast | 0.35% |
| 4 | Nundah | QLD | Brisbane - North | 0.39% |
| 5 | Annerley | QLD | Brisbane - South | 0.40% |
| 6 | North Lakes | QLD | Moreton Bay - South | 0.41% |
| 7 | Buderim | QLD | Sunshine Coast | 0.42% |
| 8 | Boronia | VIC | Melbourne - Outer East | 0.45% |
| 9 | Coburg | VIC | Melbourne - Inner | 0.46% |
| 10 | Coorparoo | QLD | Brisbane - South | 0.47% |
Emerging opportunities in regional areas and city outskirts
In contrast to the tight inner-city markets, some regional areas and city outskirts are experiencing an easing in rental market pressures.
Suburbs like Taylor and Denman Prospect in Canberra, as well as regions in NSW, are benefiting from recent housing developments, offering more options to renters.
Victoria and Queensland are witnessing similar trends, with suburbs on Melbourne’s fringe and regions in Queensland showing higher vacancy rates than their respective city centres.
This trend is offering both choice and value for renters, despite the overall tight market conditions.
The suburbs with the most rental properties available
| Rank | Suburb | State | Region (SA4) | Vacancy rate |
| 1 | Taylor | ACT | Australian Capital Territory | 14.7% |
| 2 | Dysart | QLD | Mackay - Isaac - Whitsunday | 13.0% |
| 3 | Collinsville | QLD | Mackay - Isaac - Whitsunday | 11.6% |
| 4 | Newman | WA | Western Australia - Outback (North) | 11.3% |
| 5 | Denman Prospect | ACT | Australian Capital Territory | 10.1% |
| 6 | Berridale | NSW | Capital Region | 9.7% |
| 7 | Pegs Creek | WA | Western Australia - Outback (North) | 9.4% |
| 8 | Nickol | WA | Western Australia - Outback (North) | 8.1% |
| 9 | Broulee | NSW | Capital Region | 8.1% |
| 10 | Birmingham Gardens | NSW | Newcastle and Lake Macquarie | 7.8% |
Looking ahead
Creagh concludes that while challenges persist for renters, the market is showing signs of rebalancing.
Factors like increasing household sizes and growing investor interest are playing a role in this shift, potentially easing conditions in the rental market.
