New data shows tenants are already paying sharply more in Sydney, Melbourne and Brisbane, just as federal budget changes cast doubt on future rental supply.
Weekly asking rents in the capital cities rose an average 6.9% over the past year, according to SQM Research figures released on Wednesday. The combined rents for houses and units in Sydney are up 7.1% year-on-year, with Melbourne up 6.3% and Brisbane jumping 8.7%.
Analysts at SQM Research expect the annual pace of rent growth could reach about 10% over the next 12 months. That would push gains above the 9.2% peak recorded in November 2023.
SQM Research warns that the underlying shortage of rental homes is likely to deepen as a result of settings outlined in last week’s federal budget. The group argues that budget measures are unlikely to lift residential construction quickly enough to match demand, and may instead deter some investment in rental properties.
With building activity showing no meaningful acceleration, the current imbalance between tenants looking for homes and the stock available for lease remains entrenched. Industry watchers say that combination points to further rent inflation pressure for city dwellers.
