Omari Gates
Australia is currently facing a rental crisis, with high demand and low supply causing soaring rents and a decline in the availability of affordable housing. In 2021, nearly 3 million households, or 31% of Australians, were renting their residences, with two-thirds renting from private landlords and a small minority from public housing authorities. This proportion has increased over the years, with the number of renting households in New South Wales (NSW) alone increasing by over 17.5% since 2016. The average weekly rent in Australia is $570, with units typically cheaper than houses.
| Characteristics | Values |
|---|---|
| Number of households in Australia | 9.8 million |
| Percentage of households renting residences | 31% (nearly 3 million households) |
| Average weekly price for a rental | $570 AUD |
| Average weekly housing costs for renters | $379 |
| Percentage of renters' income spent on rent | 20% |
| Percentage of households renting from private landlords | 83% |
| Percentage of households renting from public housing authorities | 3% |
| Vacancy rate | 1.1% |
| Rental price growth between 2022 and 2023 | 10.1% |
| Percentage of single-parent households renting | 47% |
| Percentage of couples with children renting | 24% |
| Cities with the highest growth rates in 2022-23 | Perth and Melbourne |
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What You'll Learn
Around 31% of Australian households rent their residences
In 2019-20, around 31% of Australian households, or nearly 3 million households, rented their residences. This is a slight decrease from 32% in 2017-18. The vast majority (around 83%) rent from private landlords, while a small minority rent from public housing authorities. Over the last three decades, the proportion of Australians in public housing has halved, while the amount renting privately has grown by over 40%. This shift has been attributed to factors such as population growth, immigration patterns, and changes in household composition.
The Australian residential rental market has experienced significant changes in recent years, with rising rents and low vacancy rates contributing to a "rental crisis." Between 2022 and 2023, national median rental prices increased by 10.1%, far outpacing the annualised CPI rate of 7%. Some suburbs in Australia saw rent increases of 30-40% from 2020 to 2022, with Bellingen on the NSW coast experiencing a 48% annual rent increase. Vacancy rates have also declined, reaching a low of 1.1% in September 2023.
The high demand for rentals and limited supply have led to upward pressure on prices. Sydney, Melbourne, and Adelaide have witnessed surging rents, with increases of at least 10% and up to 15% in Adelaide as of October 2022. This trend is particularly pronounced in the top-end of the market, including luxury apartments and detached homes. However, there is also pressure at the bottom end of the market, making it challenging for social housing tenants to transition into the private market.
The COVID-19 pandemic has had a substantial impact on Australia's rental markets. During the pandemic, there was a desire for more space and a reduction in average household size, further squeezing the demand for rentals. The pandemic also affected internal migration patterns, with annual rental growth in regional areas initially surging but then slowing down as behaviours began to unwind. Additionally, the pandemic brought attention to the issue of housing stress, particularly for lower-income earners, with some temporary relief provided through income supplements and rent freezes for public housing tenants.
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83% rent from private landlords
Australia's residential property market provides rental properties to tenants by landlords. In 2021, there were nearly 9.8 million households in Australia, of which around 31% or nearly 3 million households were renters. Of these renter households, 83% rent from private landlords, while less than 10% rent from public housing authorities. The proportion of households renting from a public housing authority has approximately halved since 1995, while the proportion renting from a private landlord has increased by over 40%. This shift towards private rentals is also reflected in the decline of social housing stock, which comprises only 4.2% of overall housing.
The high demand for rental properties in Australia, particularly in major cities like Sydney and Melbourne, has resulted in a shortage of supply. This has led to a significant increase in rent prices, with some suburbs experiencing rent increases of 30-40% from 2020 to 2022. The average weekly rental price in Australia is $570, with Sydney being the most expensive capital city. Rental rates have increased faster than inflation, and vacancy rates are low, making it challenging for renters to find suitable accommodation.
The COVID-19 pandemic has also impacted the rental market, with internal migration patterns affecting demand and supply in different regions. While annual rent growth in regional areas has slowed, major cities continue to experience surging rent growth. For example, advertised rents in Sydney, Melbourne, and Adelaide have increased by at least 10% in the year leading up to October.
The rising cost of rentals has become a prominent political issue, with various solutions proposed to address the "rental crisis." Some economists suggest supply-side reforms, such as changes to residential construction approval processes, while others advocate for price controls or demand-side reforms like immigration restrictions. However, the actions of Australia's major parties have been criticized as inadequate by some.
The high cost of rentals disproportionately affects lower-income households, who spend a more significant proportion of their income on housing costs. This has resulted in instances of low-income households being unable to find suitable accommodation and, in some cases, facing homelessness. The Australian Greens have proposed introducing rent controls to alleviate the financial burden on renters.
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Rental rates have increased faster than inflation
Around one-third of all Australian households rent their homes, either in the private market or in public housing. In 2019-20, average weekly housing costs were $493 for owners with a mortgage, $54 for owners without a mortgage, and $379 for renters. While owners with a mortgage spent 16% of their income on housing costs, renters spent 20%.
Several factors have contributed to the surge in rental rates, including a long-running undersupply of housing, increased building material costs, rising interest rates, extremely low vacancy rates, and an acute shortage of social housing. Population increases in Australia, driven by overseas migration to major cities, have also increased the demand for housing.
The rental crisis has disproportionately impacted low-income households, who are being priced out of the market. In regional Queensland, rents surged by nearly 60%, while incomes climbed less than 17%. Similarly, in Perth, rental affordability has reached its lowest point in a decade due to rising interest rates, a resources boom, a population surge, and inflation.
To address the issue of spiralling rents, some have suggested implementing rent caps, which could ease pressure on renters and the economy as a whole. However, there is little hope on the horizon for renters, as both major parties are more focused on increasing home ownership.
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The average weekly price for a rental is $570 AUD
Housing affordability is a pressing issue in Australia, and understanding rental trends is crucial for tenants and policymakers. While the average weekly rental price in Australia was $379 in 2019-20, this figure has increased significantly in recent years.
The median rent in Australia rose to $665 a week in June 2025, according to Cotality, the property data and insights provider. This represents a 3.4% increase over the past year, outpacing rental growth in countries like the US, UK, Europe, Japan, and New Zealand. However, it is worth noting that rental prices vary widely across different cities and states in Australia. For example, Sydney had the highest weekly rent of $796, while Hobart was significantly lower at $581 per week.
The rising cost of living and the temporary spike in overseas migration have contributed to the increasing rental prices in Australia. Slower processing of international student visas has led to a decrease in population growth, resulting in more stable rent demand. Additionally, an increase in average household size, particularly in capital cities, has reduced the number of dwellings needed, countering rental price growth.
The high growth in rental prices has led to financial stress for many Australian renters. According to Mozo's 2024 rental report, 49% of renters spend at least 30% of their income on rent, with 11% spending more than 60%. Queenslanders report the highest rates of rental stress, followed by Western Australia, New South Wales, Tasmania, South Australia, and Victoria.
While renting offers flexibility, the rapid rise in rental prices may prompt some to consider purchasing their own homes. However, this decision ultimately depends on an individual's financial situation and preferences for living arrangements.
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Sydney has the most expensive capital city rents
In 2021, there were nearly 9.8 million households in Australia. Of these, almost one-third (31%) rented their homes in 2019-20, a slight decrease from 32% in 2017-18. While owners with a mortgage spent 16% of their income on housing costs, renters spent 20%.
Sydney has consistently been ranked as the most expensive capital city for renters in Australia. As of 2025, the median weekly rent for a house in Sydney is $775, with unit prices at $720 per week. This is a notable increase from the median weekly rent of $679 in 2023, which was already considered high compared to other capital cities.
The high rental prices in Sydney can be attributed to various factors, including high demand and limited supply. Sydney is a desirable location for many, including overseas arrivals, which increases the competition for rental properties. Additionally, Sydney's status as a global city and a centre for economic opportunities contributes to the high rental costs.
The high cost of renting in Sydney has had a significant impact on its residents. Many renters in Sydney face financial challenges due to the significant proportion of their income spent on housing. This has also led to a competitive rental market, with applicants feeling pressured to bid above the advertised price or offer multiple months' rent in advance to secure a property.
While Sydney holds the distinction of being the most expensive capital city for renters, other Australian cities are also experiencing rapid rent increases. Cities like Canberra, Darwin, Brisbane, and Adelaide have seen significant rent hikes, contributing to a nationwide trend of rising rental costs.
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Frequently asked questions
According to the Australian Bureau of Statistics, 31% of households in Australia rent their residences. This equates to nearly 3 million households.
The number of renting households in New South Wales has increased by over 17.5% since 2016. Renters now make up close to a third of all households in the state, with over 2 million people renting in the private rental market.
83% of renters in Australia rent from private landlords, while less than 10% rent from public housing authorities.
The average weekly price for a rental in Australia is $570 AUD. Units are typically cheaper, with a national median of $540, while houses are $582.
