Packed inspections, skyrocketing rents and a fear of price hikes are leaving renters intimidated as vacancy rates plummet to record lows, a report shows.
The median cost to put a roof over your head in a capital city has surged 44 per cent in five years to top $700 per week for the first time, Cotality (formerly Corelogic) says in its Quarterly Rental Review.
And rentals are harder than ever to find with only 1.47 per cent, or roughly one in every 68 properties, available to lease – less than half the pre-COVID average.
Limited listings and packed inspections are pressuring renters to apply for unsuitable properties, or to outbid to get their foot in the door, Tenants’ Union of NSW’s Leo Patterson Ross said.
“With these large groups trying to inspect the same place, it’s very intimidating,” he told AAP.
“So people are being kind of pushed out further and further away from employment, from their communities, and all of that is very disruptive.”
Meanwhile, many in existing rentals weren’t reporting repair needs, due to fears landlords would bump rents further, Mr Patterson Ross said.
“You’re trying to avoid a rent increase or having to move house in a really competitive market, so it all puts pressure on throughout the tenancy experience,” he said.
While reforms to ban no-cause evictions and limit the frequency of rental hikes have been broadly implemented across Australian jurisdictions, only the ACT has developed an “excessive rent increase” guideline linked to the consumer price index (CPI).
“In other essential areas like water or energy, we put in pricing structures to make sure that the community is getting a fair deal,” Mr Patterson Ross said.
“We haven’t done that in renting.”
Roughly one in three Australian households rent their home, according to Census figures.
Sydney remains the most unaffordable city to live, with a median price of $807 a week, followed by Perth ($729) and Brisbane ($696), while Hobart was the least expensive at $584 per week, the Cotality report found.
Darwin recorded the largest increase in rental prices, rising almost eight per cent, or an extra $49 to $687 per week at the median, while Melbourne recorded the slightest increase at 1.4 per cent to a median price of $615.
Regional rents were comparatively more affordable at $591 per week but rising quickly, up 5.9 per cent in the year to September, compared with 3.7 per cent in the capitals and 4.3 per cent nationally, Cotality economist Kaytlin Ezzy said.
“Limited supply continues to be a major catalyst in rising rents, with the number of rental listings tracking approximately 25 per cent below the previous five-year average nationally for this time of year,” she said.
And while price growth was easing for certain goods, surging rents could complicate the outlook for further interest rate cuts, Ms Ezzy said.
“With ‘rents paid’ a key component of the Consumer Price Index (CPI), the increased pace of rental value growth seen in recent months could push inflation higher,” she said.
“This renewed momentum in rents may lead to inflation exceeding RBA forecasts, which could keep the cash rate elevated for longer.”
Australian Associated Press is the beating heart of Australian news. AAP is Australia’s only independent national newswire and has been delivering accurate, reliable and fast news content to the media industry, government and corporate sector for 85 years. We keep Australia informed.
