Australian residential rental market

The Australian residential property market is the section of the Australian property market that provides rental properties by landlords to tenants. In Australia 31% of households rent their residences. The vast majority rent from private landlords, and a small minority rent from public housing authorities. Over the last three decades the proportion of Australians in public housing has halved, whilst the amount renting privately has grown. The average weekly price for a rental in Australia is $570 AUD. Sydney has the most expensive capital city rents. Rental rates have increased faster than inflation in recent years.

In recent years, the cost of Australian rentals has become a prominent political issue; dubbed the 'rental crisis'. Demand remains high while supply is low. Some have advocated supply-side reforms to address the crisis, such as reforms to construction approvals, others for price controls, and others for demand-side reforms like immigration restrictions. The actions of Australia's major parties on the issue have been widely criticised as inadequate, though praised by some.

Renting
Around one third of Australia's 9.8 million households pay rent for their residences. The other two thirds are owner-occupiers, half of whom have a mortgage. Of the households that rent, ~83% rent from private landlords, while less than 10% rent from public housing authorities. The proportion of households from a public housing authority has approximately halved since 1995, while the proportion renting from a private landlord has increased by over ~40%.

Immigrants overwhelmingly settle in Sydney and Melbourne, exacerbating the shortage of supply in those cities.

Rental prices
The average weekly price for a rental in Australia is $570 per week. Units are typically cheaper, at a national median of $540 vis-a-vis houses at $582. Rental prices grew nationally by 10.1% between 2022 and 2023; substantially higher than the annualised CPI rate of 7% for the period. Vacancy rates are historically quite low, at around 1%; a rate some argue is indicative of upward price pressure.

Median rents across Australian cities as of Q1 2023 is as follows:

Australian rental crisis
Rental availability and affordability has become a prominent issue in Australian Politics recently, with the topic being the subject of substantial media coverage and political debate. Media reports have included coverage of low income households being unable to find suitable accommodation and forced into homelessness. Some suburbs in Australia saw rent increase between 30-40% from 2020 to 2022; with Bellingen on the NSW coast experiencing an annual rent increase of 48%. In September 2023, the national vacancy rate declined to 1.1%.

Reasons provided for the crisis vary, with some blaming failures in residential construction processes at the council level, a lack of public housing construction, vacant residences, increases in short-stay accommodation or demand factors like immigration. Reductions in average household size during the Covid-19 pandemic have also been pointed for driving a demand squeeze. The pandemic has prompted a desire for more space and to live with fewer people.

Solutions proposed to address Australia's rental crisis also vary. Some economists have proposed reforms to residential construction approval process, while others (most notably the Australian Greens) have proposed an introduction of rent controls. Major parties proposals at a national level to address the issue have included a scheme proposed by the ALP called the 'social housing fund', whilst The Coalition has promoted assistance schemes to increase rates of home-ownership. The responses of Australia's major parties have been criticised as inadequate.