CoreLogic's rental review for the March quarter revealed an annual jump in rental rates of more than 10%, and vacancy rates remaining near record lows.

The quarterly increase was 2.5%, up from 2% in the December quarter, for the national median rent to reach $570.

In its equivalent report, PropTrack also estimated median rents to have increased more than 2%, but had a more conservative median estimate of $500.

Vacancy rates for the March quarter were down to 1.1%, compared to 1.6% this time last year.

The average renter in Australia will now be paying an extra $52 a week in rent, or $2,727 per year.

SQM Research's weekly index released Tuesday yesterday paints a more grim picture, with rents up in all capital city unit and house markets, except for Darwin units that posted a decline over the year.

Asking rents for Sydney units led the charge, up 30.2% the past 12 months to $652 a week; Sydney house rentals were also most expensive among the capital cities at $961.

Booming demand...

CoreLogic Economist and report author Kaytlin Ezzy said that a surge in overseas migration was driving the excess demand for rental properties.

Australia's largest capital cities saw the most dramatic growth, with an annual 14.3% increase to unit prices showing a preference for accommodation in high density areas.

“The uptick in rental growth can be attributed to surging rents in the unit market, particularly across the largest capitals, with increased demand from overseas migration occurring amid a shortage of rental supply pushing rents higher,” she said.

CoreLogic Head of Research Eliza Owen has also pointed out the post pandemic trend of tenants moving away from shared accommodation, seeking more space and fewer housemates.

"The number of people per household fell from 2.6 to 2.5, which doesn't sound like that much of a difference, but the RBA estimates that it added to housing demand by about 120,000 dwellings," Ms Owen told the Savings Tip Jar podcast.

...and inadequate supply

Ms Ezzy also highlighted the deficiencies on the supply side of the rental market.

"There’s already a chronic undersupply of advertised rental stock in many parts of the country that’s translated into record low vacancy rates across most capitals. Such a low number of available rentals is a key factor that pushed rental values higher again last quarter,” Ms Ezzy said.

Over the four weeks to 2 April, the total number of rental listings throughout the whole of Australia was below 95,000.

This is 17.3% below the same period in 2022, and 36.3% less than the five year average.

However, government intervention thus far - such as Queensland's rent cap - has drawn the ire of property pundits who say they will only exacerbate the supply problem.

Ms Owen expressed concerns along these lines, but did say she didn't anticipate the catastrophic consequences others have warned of.

"Investor participation is much more aligned with capital growth than it is with rental returns or policies around rental security," Ms Owen said.

"[Capping rental increases] doesn't help, but I don't think it's something that's necessarily going to completely disincentivise investors."

Any sign of relief?

Some rental house hunters might be taking solace in yesterday's news that the RBA would not increase the cash rate for the eleventh month in a row.

Higher mortgage repayments tend to trickle through to higher rental rates, although CoreLogic pointed out despite record rental inflation, rates are still not keeping pace with mortgage increases, which could escalate the negative cash flow faced by some investors.

Some analysts highlighted the softer tone of RBA Governor Dr Phillip Lowe's accompanying remarks with the monetary policy decision, suggesting further rate rises were not inevitable.

Many economists though expect the cash rate to be raised once or twice more over the next couple of months, which would put additional pressure on tenants at end-of-lease time.


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Update resultsUpdate
BankSavings AccountBase Interest Rate Max Interest Rate Total Interest Earned Introductory Term Minimum Amount Maximum Amount Minimum Monthly Deposit Minimum Opening Deposit ATM Access Joint Application TagsFeaturesLinkCompare
4.40% p.a.
5.75% p.a.
Intro rate for 4 months
then 4.40% p.a.
4 months
  • Bonus rate for the first 4 months from account opening
  • No account keeping fees
  • No minimum balance
1.20% p.a.
Bonus rate of 4.20%
Conditions apply.
5.40% p.a.
4.75% p.a.
5.35% p.a.
Intro rate for 4 months
then 4.75% p.a.
4 months
  • A high-interest online savings account with no monthly fees, easy withdrawals and award-winning digital banking
  • No withdrawal notice periods or interest rate penalties
  • Save up to 10% on eGift cards at over 50 retailers with Macquarie Marketplace
Bonus rate of 5.50%
Conditions apply.
5.50% p.a.
Featured *Rate varies on savings amount
  • Deposit $500 per month to get bonus interest
  • 5.50% p.a. available on total savings up to $100k.
  • 5.00% p.a. applies to savings between $100k-250K.
  • Tiered bonus rates apply. (TMDs at
Important Information and Comparison Rate Warning

All products with a link to a product provider’s website have a commercial marketing relationship between us and these providers. These products may appear prominently and first within the search tables regardless of their attributes and may include products marked as promoted, featured or sponsored. The link to a product provider’s website will allow you to get more information or apply for the product. By de-selecting “Show online partners only” additional non-commercialised products may be displayed and re-sorted at the top of the table. For more information on how we’ve selected these “Sponsored”, “Featured” and “Promoted” products, the products we compare, how we make money, and other important information about our service, please click here. Rates correct as of . View disclaimer.

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