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Rents continued to rise during the June quarter, though the pace of growth was tempered by economic pressures that affected tenant demand, the latest research from Cotality shows.
Cotality’s latest Quarterly Rental Review has shown that rental prices nationwide continued to increase during the June quarter, rising by 1.3 per cent to $665 per week for all dwellings.
Data from Cotality showed that rental prices across the capital cities rose 1.5 per cent over the quarter, and by 5.3 per cent over the year, with the smaller capitals surging to the forefront for annual growth.
Across the capital cities, Darwin led with annual rental growth of 6.2 per cent, rising to $659 per week, and was followed closely by Perth’s 4.9 per cent growth to $721, and Brisbane’s 3.8 per cent rise to $687 per week.
Despite Sydney’s weaker annual growth of 1.9 per cent, Cotality data showed that the Harbour City’s median weekly rent climbed to $796 across all dwellings, remaining the most expensive city nationwide.
Perth’s growth over Q2 enabled it to take out a distant second place with a typical dwelling rent of $721 per week, while Brisbane’s weekly rent of $687 saw the Queensland capital overtake Canberra to claim the third-highest median rent of the capital cities.
Cotality economist Kaytlin Ezzy said the changes to the most expensive cities for rental prices was driven by the varied rental conditions of the nation’s capital city markets.
“Just under three years ago, Canberra held the title for the country’s most expensive city to rent in, but weaker growth conditions, and a compositional shift towards units, have seen the national capital land firmly in the middle of the pack,” Ezzy said.
On the other side of the spectrum, Canberra recorded an annual increase of 1.6 per cent during the June quarter, with Melbourne’s 1.2 per cent growth marking the softest 12-month increase across the capital cities.
Despite Hobart’s higher annual growth of 5.3 per cent, the city still remains the only capital with a median weekly rental value under the $600 week, with a typical Hobart dwelling renting for just $581 per week.
Rental growth slows over Q2
Although rental prices increased across the nation during the June quarter, Ezzy said the pace of national rental growth had slowed over the first half of 2025.
“After shifting higher through the seasonally busy first quarter (1.7 per cent), the rolling quarterly change in national rental values is once again trending lower, with rents up 1.3 per cent over the three months to June 2025,” Ezzy said.
Cotality’s findings showed the easing was also evident on an annual basis, with the 3.4 per cent increase in national rents over FY 2024–25 marking the lowest yearly increase since the 3 per cent growth of the 12 months to February 2021.
Despite the deceleration in rental growth over Q2 2025, Ezzy said that available rental supply had remained “exceptionally low” during the June quarter.
In total, around 100,000 properties were listed nationally in the four weeks to 29 June, which Cotality said was roughly 23 per cent below the previous five-year average.
“The shortfall in rental listings has seen the national vacancy rate slip to 1.6 per cent in June, only slightly above the record lows seen in early 2024 (1.5 per cent), and less than half the pre-COVID decade average of 3.3 per cent,” she said.
Instead, Ezzy said a variety of socioeconomic factors had slowed rental growth during the second quarter of 2025, such as worsening affordability rates which have stifled rental demand.
“Over the past five years, rents have increased by 42.7 per cent nationally, taking the median weekly rental value almost $200 higher to $665 per week,” she said.
“Considering wages, as measured by the ABS wage price index, are up less than half this rate (15.8 per cent) over the five years to March 2025, it’s no wonder household formation trends are skewing larger as a way of spreading out the additional rental cost.”
Ezzy also pointed to decreasing net overseas migration rates as a significant influence behind reduced rental demand across the nation.
“The slowdown in rental growth instead continues to be driven by a tempering in demand, with the normalisation of net overseas migration and a rise in average household size helping to dampen rental demand,” she concluded.
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