Increased supply eases conditions for tenants
Rents across Australia are growing at their slowest pace in more than three years, with easing conditions offering some relief to tenants, according to the latest REA Group Market Insight.
Nationally, median weekly advertised rents rose by 1.6% during the December 2024 quarter, bringing the median rent to a record $620 per week. This represents an annual increase of 6.9% over 2024 — down from 11.5% in 2023 and marking the slowest annual rent growth since the September 2021 quarter.
In capital cities, advertised rents also grew by 1.6% during the December quarter to $640 per week. However, most city markets recorded no quarterly change, with Brisbane and Canberra the only exceptions.
Sydney and Melbourne, the largest rental markets, have seen no increase in advertised rents for six consecutive months, holding steady at $730 and $570 per week, respectively.
While house rents rose by 1.6% during the December quarter, unit rents remained unchanged. Over the year, unit rents grew slightly faster (+7.1%) than house rents (+5.9%), highlighting a moderate shift in demand.
In regional areas, rents were flat during the quarter, holding steady at $550 per week, though they posted a robust annual increase of 10% over 2024.
REA Group senior economist Paul Ryan (pictured above) attributed the slower rental growth to an increase in available rental properties and cost-of-living pressures reducing tenants’ ability to pay higher rents.
“The pace of rent growth across the country is slowing, with market conditions easing for renters,” Ryan said. “This is welcome news, particularly for renters in Sydney and Melbourne, where rents have been unchanged for six months.”
Ryan noted that January is traditionally the busiest time of the year for the rental market, as tenants seek new homes. He expects rents to increase moderately in 2025 but believes the trend of slower growth will continue throughout the year.
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