Rents hit record high as housing shortfall bites hard

Jack Gramenz |

Cottesloe in Perth is one of the few suburbs outside Sydney to attract four-figure rents.
Cottesloe in Perth is one of the few suburbs outside Sydney to attract four-figure rents.

Australia’s growing cohort of renters are being pushed further to the fringes of capital cities as rents hit a record high.

The median rent across the nation is $627 a week, ranging from $547 in Hobart to $770 in Sydney, according to property data provider CoreLogic.

The regional median was $540, driven by rises in house rents in regional Queensland and Tasmania.

Rents are going up faster in areas between 30 and 40km from city centres, CoreLogic head of research Eliza Owen reported.

New housing
A shortfall of new housing is adding to pressure on rent prices. (Dan Himbrechts/AAP PHOTOS)

“Part of the reason for the re-acceleration in rents nationally could be due to renters being forced into more affordable, peripheral housing markets as they become priced out of more desirable and central metropolitan locations,” she said.

But supply and demand pressures remain high across the nation and migration levels implied there were at least 200,000 new households in Australia, while only 173,000 new dwellings were completed to September last year, Ms Owen said.

“Given there is little that can be done on the supply side for renters in the short term, reprieve in the rental market is most likely to come from a moderation in net overseas migration,” she said.

Median rents were more than $1000 in nine areas, with adjoining Cottesloe-Claremont suburbs in beachside Perth the only area outside Sydney to command four figures.

Rents in Pittwater, almost 25km from the CBD on Sydney’s northern beaches, were the highest at $1335 per week, coming down half a percentage point since a peak in March.

Rents were still up 8.4 per cent annually in Pittwater, in line with the 8.5 per cent national increase.

The data comes after the National Housing Supply and Affordability Council launched its inaugural report on Friday, painting a dire portrait of Australia’s housing system.

Significant housing shortfalls over three consecutive years and resumed migration contributed to all-time low vacancy rates in the rental market, leading to nearly 170,000 households waiting for public housing, the report revealed.